[miningmx.com] — Platinum group metals (PGM)
rallied to their highest in about two years on Wednesday on the
back of a strong demand outlook from investors and the auto
industry, while gold edged higher as risk-appetite improved.
Upbeat results from U.S. companies such as IBM and Apple
lifted sentiment in global markets, which had turned sour
earlier this week after fraud charges against Goldman Sachs, a
major commodities trader.
“The underlying fundamentals of platinum and palladium are
significantly better than gold in our view,” said analyst Daniel
Major at RBS. “You’ve got the supply side constrained….and
much more positive outlook for demand,” he said.
Spot platinum rose to $1,737.50 an ounce, its highest since
August 2008 and was at $1,732.50 an ounce by 1017 GMT, versus
$1,714 an ounce late in New York on Tuesday. Sister metal
palladium hit a two-year high at $563 an ounce, and was last at
$560.50 an ounce versus $549 an ounce on Tuesday.
Palladium and platinum, both used to clean auto emissions
and in jewellery, have been in favour as they are considered to
be more sensitive than gold to economic recovery. They have
risen by 39 and 18.5 percent respectively so far this year,
compared with gold’s 4.4 percent.
Chinese car sales have been strong so far this year, growing
by almost two-thirds last month as buoyant consumer sentiment
lifted spending, while other leading car markets, notably the
United States, are also recovering from last year’s slump.
The launch of new investment products, such as the exchange
traded funds (ETF) in the United States, in January, has also
been a major driver behind the price for PGMs.
FURTHER LONGS IN GOLD?
Spot gold edged up to $1,144.65 an ounce from $1,139.50. It
hit a two-week low of $1,123.15 on Monday.
U.S. gold futures for June delivery advanced to $1,144.9 an
ounce, after settling at $1,139.20 on the COMEX division of the
New York Mercantile Exchange.
Traders said bullion was firm as the dollar was slightly
lower, but investors were watching the news on Greece, as the
European Union and IMF are set to begin talks for a proposed
ETFS Physical Gold (PHAU) said it saw the largest inflows in
eight months, with inflows surging $160 million last week and in
period when the gold price was falling.
“Long-term strategic investors may be taking advantage of
recent gold price weakness to further build long positions,” it
said in a report.
“While short term gold price movements will likely continue
to be affected by moves in the dollar, longer-term structural
concerns about the potential implications of rising government
debt burdens for fiat currencies and inflation, will likely keep
demand for gold from strategic investors high.”
Silver was at $17.91 an ounce from $17.81 an ounce.