Gold edged up on Wednesday to track a slight rebound in oil, while platinum gained 2% following a mine closure in South Africa and a supply and demand report that showed demand for car catalysts could still rise.
Dealers noted speculative buying in Japan and Hong Kong after Lonmin, the world's third-biggest platinum producer, closed high-cost mines and said it was cutting costs to survive a market downturn.
Precious metals refiner Johnson Matthey said global demand for platinum catalytic converters would climb 2% in 2008 on higher consumption in Europe and emerging economies, despite a sharp decline in North America.
"Their price forecast of $US700 to $US1400 is very reasonable. But there's no actual demand at this moment. Jewellery and auto companies are not buying,'' said Yukuji Sonoda, precious metals analyst at Daiichi Commodities in Tokyo.
Despite the gains, fears about the future of the financially ailing General Motors weighed on the market and could trigger another bout of selling, he said. "Tomorrow or the day after, the situation will gradually change,'' said Sonoda.
Platinum was trading at $US846.00 an ounce, up $US19.50 from New York's notional close on Tuesday, when it gained around 2%.
Johnson Matthey expected platinum to fall to $US700 over the next six months if the economic crisis continues.
US car executives warned Congress on Tuesday their industry was teetering on the brink of disaster as they pleaded for a $US25 billion aid package despite political opposition to another multibillion-dollar government bail-out.
More than 60% of global platinum use goes to autocalysts to clean exhaust fumes.
Gold, whose movements often dictate platinum, held near New York levels. Cash gold was trading at $US739.20 an ounce, up $US2.40 from New York's notional close on Tuesday, which was also due to a weaker US dollar against the euro.
"Gold will trade in a narrow range of $US710 to $US750. Despite all the positive news on gold or platinum, we still have to monitor what's happening in the financial crisis as I think that it is still the big factor that may weigh down on everything,'' a dealer in Singapore said.
Oil was little changed above $US54 a barrel on Wednesday ahead of data expected to show US crude stocks rose last week.
