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Certain drivers of the gold price are long-established: U.S. dollar weakness, rising investment demand, producer de-hedging, and reduced central bank selling. Citigroup Global Markets analyst Alan Heap focuses on a different one: China.

The China Mineral Company reports that Heap has labeled China the “most important source” of future demand growth in gold. Not all of it is from the central bank–he noted that in 2009, retail investment demand in China was “particularly” strong as overall Chinese demand rose 10%.

The focus on Chinese gold demand comes during a period of renewed concerns about asset price inflation in the country. Recently, the Chinese government has taken steps to hinder bank lending after letting it run completely out of control in 2009. That stoked inflation fears and strengthened the case for citizens to own gold. Of course, Asian central banks are not expected to ignore gold, either. Analysts from the China Mineral Company note that Chinese and Indian central banks remain extremely underweight gold, with only 1.5% and 4.1% of their total reserves in the precious metal. This stands  in contrast to the European average of 54%.