BLBG: Platinum Climbs in N.Y. as Dollar’s Sag Spurs Demand (Correct)
Platinum gained in New York while the dollar weakened, boosting demand for the metals as alternative investments to the U.S. currency. Palladium was unchanged.
The U.S. Dollar Index, down throughout the metal-trading session, rebounded after the Federal Reserve said it may buy longer-term Treasury securities to resuscitate lending and the economy. Some investors buy platinum and palladium, used mostly in jewelry and automobile parts, as alternative investments to currencies, bonds and equities.
“With today’s dovish FOMC statement platinum is poised for a thrust higher,” Ralph Preston, a commodity analyst at Heritage West Futures Inc. in San Diego, said in an e-mailed note. “Aggressive traders will be looking for a push over $979.40 an ounce to project a move to $1,012.”
Platinum futures for April delivery rose $4.70, or 0.5 percent, to $962.90 an ounce on the New York Mercantile Exchange. The price gained 0.5 percent last week and is up 2.3 percent this month.
Palladium futures for March delivery were unchanged at $191 an ounce. The price rose 6 percent last week and has gained 1.2 percent this month.
Dollar Falls
The Dollar Index, which measures the greenback against a weighted basket of six currencies including the euro and yen, touched the lowest in more than a week before the Fed’s statement. The central bank kept its target bank-lending rate in a range of zero to 0.25 percent.
The euro, down 6 percent against the dollar this month, may rebound on speculation that the European Central Bank will refrain from cutting its benchmark rate from 2 percent to zero, said Emmanuel Ng, an economist at Oversea-Chinese Banking Corp. in Singapore.
The euro slipped 0.2 percent against the dollar at 3:43 p.m. in New York to trade at $1.3136, compared with $1.316 yesterday.
Platinum rose “due to the hope for economic recovery,” said Jon Nadler, a senior analyst at Kitco Inc. in Montreal. “The recent decline was a bit overdone, especially at a time when gold was rising nicely.”
Automakers account for about half of global platinum and palladium consumption, according to estimates by Johnson Matthey Plc, a London-based metals refiner, trader and researcher. Platinum and palladium are used in catalytic converters to remove pollutants from engine exhaust gases.
