BLBG:Platinum Poised for Best Month in Year as Gold Drops in January
Platinum was poised for the best monthly gain in a year as gold headed for a fourth decline after data from the U.S. to China added to signs of a recovery, paring demand for haven assets. Palladium advanced to a 16-month high.
Spot platinum rose as much as 0.6 percent to $1,689.25 an ounce and traded at $1,686 at 3:02 p.m. in Singapore, taking the advance this month to 9.5 percent, the most since January last year. While gold gained 0.3 percent to $1,667.95 an ounce, it’s down 0.4 percent this month, poised for the worst run since May.
Investors are buying platinum at the fastest pace in three years as producers cut output even as data points to faster expansions in the world’s largest economies. Purchases through exchange-traded products rose 9.3 percent this month, the most since January 2010, data compiled by Bloomberg show. In contrast, holdings in gold-backed ETPs are set to shrink for the first time in six months after reaching a record in December.
“The more cyclical platinum and palladium should outperform gold” on further signs of recovery, Credit Suisse Group AG analysts including Nannette Hechler-Fayd’Herbe, head of global financial markets research, wrote in a report today.
Spot palladium climbed as much as 0.2 percent to $752.75 an ounce, the highest price since September 2011, and traded at $752.50, taking gains this month to 6.8 percent. Both palladium and platinum are mainly used in autocatalysts and benefit from increased vehicle sales and faster economic growth.
Fed Meeting
U.S. Federal Reserve policy makers conclude a two-day meeting today that’s expected to press on with a third round of stimulus to bolster the recovery. U.S. durable-goods orders climbed in December for an unprecedented fourth consecutive month, data showed on Jan. 28, while China’s economy snapped a seven-quarter slowdown in the final three months of 2012.
Platinum jumped to a three-month high on Jan. 15, exceeding the price of gold for the first time since April, after Anglo American Platinum Ltd. (AAL), the largest producer, said it will idle four shafts and cut jobs in South Africa. The company said this week it will hold off job-cut plans after government criticism.
Palladium is expected to outperform platinum as demand beats supplies, according to Goldman Sachs Group Inc. Reserves in Russia are “pretty much exhausted,” and inventory sales fell 68 percent last year, according to Johnson Matthey Plc.
Cash silver climbed as much as 0.3 percent to $31.50 an ounce and traded at $31.435, rising for a second day. Sales of American Eagle silver coins jumped to a monthly record in January after the U.S. Mint resumed transactions, which were suspended for more than a week because of a lack of inventory.
To contact the reporter on this story: Glenys Sim in Singapore at gsim4@bloomberg.net
To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net
