Palladium Stays Near 3-Week High
Palladium futures traded around $1,000 an ounce, near a three-week high, as traders assess a subdued demand outlook against diplomatic efforts in the Middle East. A Democratic sweep in the US midterms could complicate President Trump’s foreign policy agenda and efforts to secure additional funds for the war with Iran, offering some relief to inflationary concerns. However, stronger-than-expected US inflation and labour market data raised bets of a Fed rate hike next month, pushing borrowing costs higher and limiting demand for the non-yielding metal. Over the longer term, elevated financing costs, alongside weaker vehicle production and the gradual shift towards EVs, weigh on automotive demand, a major source of palladium consumption. Still, a modest recovery is expected in 2027 amid stable hybrid 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 traded around $1,000 an ounce, near a three-week high, as traders assess a subdued demand outlook against diplomatic efforts in the Middle East. A Democratic sweep in the US midterms could complicate President Trump’s foreign policy agenda and efforts to secure additional funds for the war with Iran, offering some relief to inflationary concerns. However, stronger-than-expected US inflation and labour market data raised bets of a Fed rate hike next month, pushing borrowing costs higher and limiting demand for the non-yielding metal.
Over the longer term, elevated financing costs, alongside weaker vehicle production and the gradual shift towards EVs, weigh on automotive demand, a major source of palladium consumption. Still, a modest recovery is expected in 2027 amid stable hybrid 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.