By Halia Pavliva Dec. 18 (Bloomberg) -- Platinum fell in New York, after rising to the highest price this month, as the dollar strengthened against the euro. Palladium rose. The dollar gained for the first time in seven sessions against the euro today, rising as much as 1.7 percent, the most this month. Platinum is mostly used by jewelry makers and for pollution-control devices by car and truck manufacturers, whose sales have plunged this year. Commodities often move in the opposite direction of the greenback. “It’s all U.S. dollar related,” Miguel Perez-Santalla, a sales vice president a Heraeus Precious Metals Management in New York, said today in a note. “The U.S. dollar gets weaker, the metals get stronger and vice versa. As the dollar goes so will platinum for the time being, as there is very little industrial demand at the moment.” Platinum futures for January delivery slipped $1.30, or 0.2 percent, to $863.90 an ounce on the New York Mercantile Exchange. Earlier today, the price reached $889.90, the highest for a most-active contract this month. The metal has tumbled 63 percent from a record $2,308.80 on March 4. Palladium futures for March delivery climbed 90 cents, or 0.5 percent, to $178.50 an ounce. The price has dropped 53 percent this year. Auto sales in the U.S. fell 37 percent last month to the lowest annual pace in 26 years. European car sales slid 26 percent in November, the biggest monthly drop since 1999, according to the European Automobile Manufacturers’ Association. Automakers account for about 60 percent of global platinum use. Production Cutbacks Some miners in South Africa, source of almost 80 percent of global platinum supplies, are reducing output as prices slump, David H. Brown, chief executive officer of Impala Platinum Holdings Ltd., the world’s second-biggest producer said yesterday. The cutbacks began as U.S. automakers faltered, and the government struggled to come up with a rescue plan. “Platinum could not benefit sufficiently from the announced South African production cuts, as in the end the automotive rescue talks appeared to be less than promising at this time,” Jon Nadler, a senior analyst at Kitco Inc. in Montreal, said in an e-mailed note. “President Bush expressed worries about the potential for a ‘disorderly’ unraveling of the U.S. auto industry.” General Motors Corp., Ford Motor Co. and Chrysler LLC will shutter temporarily about 59 factories over the next month as they struggle with declining sales. The White House said a decision on a bailout won’t come today. GM, the biggest U.S. automaker, and No. 3 Chrysler are counting on President George W. Bush to approve emergency loans to help prevent a collapse that threatens millions of jobs. Without $14 billion in federal aid, the manufacturers have said they will be out of money by early next year. Bush said he is “worried about a disorderly bankruptcy and what it would do to the psychology of the markets” at a forum in Washington today. To contact the reporter on this story: Halia Pavliva in New York at hpavliva@bloomberg.net.

Source