Palladium hits high as its soars above gold price

SENEGAL-ENVIRONMENT-POLLUTION
Palladium has been helped by a move to petrol cars after Volkswagen's diesel emissions scandal (Source: Getty)

Palladium has soared to record levels, eclipsing the value of gold for the first time in 16 years.


The metal, which is primarily used to help reduce emissions in petrol-driven cars, has jumped by around 50 per cent over recent months to a high of $1,264 per ounce.

This today put it at a premium to gold, which was trading at $1,235 an ounce, pushed down this year by worries over US President Donald Trump’s trade war with China.

Investors have surprised analysts by not turning to gold as a safe bet in uncertain times.

Palladium has also been helped out by the decline of its sister metal platinum, whose price has dropped after the diesel emissions scandal which broke in 2015.


Demand for platinum, which is primarily used to reduce emissions in diesel cars, dropped after Volkswagen said it cheated on emissions tests.

“Palladium is characterised by the strongest supply-demand backdrop across the major precious metals,” consultancy Metals Focus said.

Analysts said they expect palladium demand from the automotive sector to climb to a record high of 8.5m ounces in 2018.

It has been boosted by the move towards petrol engines and the growth of hybrid vehicles, which tend to run on petrol and electricity.

“In the short term, more speculators could jump on the bandwagon and drive the price even higher, especially as the palladium market is very small and illiquid,” Commerzbank said.



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