Platinum Falls From 3-Week High
Platinum futures fell below $1,570 an ounce, easing from a three-week high as growing expectations of another Fed rate hike dimmed the outlook for investment demand in the metal. Stronger-than-expected US inflation and labour market data boosted expectations of a rate increase next month, pushing borrowing costs higher. Higher rates put downward pressure on investment demand for the non-yielding metal. At the same time, elevated financing costs weigh on automotive demand, a major source of platinum consumption. The sector also faces headwinds from weaker vehicle production and the gradual shift towards EVs. Against this backdrop, expectations of a modest market surplus are adding to bearish pressures. However, rising hybrid production and continued demand for catalytic converters are helping cushion the decline, while longer-term demand from green hydrogen and industrial applications provides some support.
Platinum futures fell below $1,570 an ounce, easing from a three-week high as growing expectations of another Fed rate hike dimmed the outlook for investment demand in the metal. Stronger-than-expected US inflation and labour market data boosted expectations of a rate increase next month, pushing borrowing costs higher. Higher rates put downward pressure on investment demand for the non-yielding metal. At the same time, elevated financing costs weigh on automotive demand, a major source of platinum consumption.
The sector also faces headwinds from weaker vehicle production and the gradual shift towards EVs. Against this backdrop, expectations of a modest market surplus are adding to bearish pressures. However, rising hybrid production and continued demand for catalytic converters are helping cushion the decline, while longer-term demand from green hydrogen and industrial applications provides some support.