Palladium Holds at Lowest Since in 16 Months
Palladium futures fell below $1,100 an ounce, remaining at its lowest level since June 2025, amid persistent investment outflows and a bearish long-term demand outlook. Traders have lowered price forecasts as demand cools and prospects for the auto sector weaken. Despite the Fed holding rates steady at its latest meeting, markets are widely pricing in another hike by year-endas surging energy costs linked to the Middle East conflict fuel inflation concerns. Higher rates put downward pressure in investment demand for the non-yielding metal. Meanwhile, the auto sector, which accounts for over 80% of palladium demand, faces pressure from rapid EV adoption, weak vehicle sales and tighter consumer spending amid the conflict. Still, a modest recovery is expected in 2027 amid stable hybrid-catalyst driven demand. Constrained output from Russia, the world's largest palladium producer, offers some support, with Nornickel warning that an overhaul at one of its plants could extend into 2028.
Palladium futures fell below $1,100 an ounce, remaining at its lowest level since June 2025, amid persistent investment outflows and a bearish long-term demand outlook. Traders have lowered price forecasts as demand cools and prospects for the auto sector weaken. Despite the Fed holding rates steady at its latest meeting, markets are widely pricing in another hike by year-endas surging energy costs linked to the Middle East conflict fuel inflation concerns. Higher rates put downward pressure in investment demand for the non-yielding metal.
Meanwhile, the auto sector, which accounts for over 80% of palladium demand, faces pressure from rapid EV adoption, weak vehicle sales and tighter consumer spending amid the conflict. Still, a modest recovery is expected in 2027 amid stable hybrid-catalyst driven demand. Constrained output from Russia, the world's largest palladium producer, offers some support, with Nornickel warning that an overhaul at one of its plants could extend into 2028.