Higher truck loadings no panacea for platinum

The price of platinum has risen nearly 5% since the start of February, buoyed by heightened uncertainty prompted by the outbreak of COVID-19. Later this year, and assuming the virus is successfully contained, we anticipate that a gradual turnaround in global growth will stunt platinum’s safe-haven demand and lower its price.
Alexander Kozul-Wright Commodities Economist
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Metals Data Response

Global Aluminium Production (Dec.)

Although global aluminium output fell in y/y terms in December, it still grew strongly over 2021. The lifting of power restrictions in China has helped increase global output despite a reduction in European output resulting from energy shortages. Looking ahead, we expect a slowdown in Chinese construction activity to weigh on aluminium prices in 2022.

20 January 2022

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Slower growth in China to drag on prices in 2022

While high power prices and low stocks will support prices in the near term, we think that prices will pull back in the second half of 2022 as Chinese economic activity slows further and supply improves. Drop-In: Neil Shearing will host an online panel of our senior economists to answer your questions and update on macro and markets this Thursday, 13th January (11:00 ET/16:00 GMT). Register for the latest on everything from Omicron to the Fed to our key calls for 2022. Registration here.

13 January 2022

Metals Data Response

Global Steel Production (Nov.)

Global steel production contracted in y/y terms in November, mainly owing to depressed output in China. Although China’s power rationing came to an end last month, there are no signs of an upturn in steel supply. Given our expectation that construction-related steel demand will remain subdued, a sustained rebound in China’s steel production appears unlikely in the coming months.

22 December 2021

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Precious Metals Update

Gold jewellery demand takes a pounding

The latest trade data show sharp contractions in gold imports by major consumers China and India, suggesting that gold jewellery demand has taken a battering. Until signs emerge that the spread of COVID-19 is easing, we expect jewellery demand for gold to remain weak. However, strong safe-haven buying by investors should ensure that the price of gold rises in the near term.

9 April 2020

Precious Metals Update

Car sector woes spell bad news for PGMs

As growing numbers of car companies idle production in response to COVID-19, we suspect that platinum group metals (PGM) demand will slow to a crawl. What’s more, job losses and income cuts due to lockdowns will curb car sales long after containment measures are lifted. Given their extensive use in auto parts, we think that palladium and platinum will be oversupplied in 2020.

6 April 2020

Precious Metals Update

Deflationary fears a bad omen for gold

Fire sales of gold have seemingly given way to safe-haven buying following yesterday’s unprecedented intervention by the Federal Reserve. Providing the Fed has injected sufficient liquidity to defend against a further collapse in equity prices, we expect the gold price to tread water. That said, the possibility of a deflationary cycle poses a major downside risk to our forecast.

24 March 2020
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