Because platinum has reached record prices on the stock market

Because platinum has reached record prices on the stock market

Bets on the recovery of the auto market push the valuation of the metal, which has reached its highest prices in six years now

(photo: Getty Images) The price of platinum has reached its highest in six years in recent days and continuing its climb it has touched the threshold of $ 1,300 an ounce. According to observers, the market is betting on the industrial recovery of the automotive sector after the pandemic, which should restart demand for the precious metal, used in various car components, from diesel to the most innovative ones. However, in addition to optimism on the market, there are several other reasons behind the growth that continued until Monday morning, when it reached $ 1,298.90 an ounce, starting with the fight against emissions.

The commodity has so far been traded as a "little sister" to palladium, which is priced at around $ 2,400, but both are used in car catalytic converters and the disparity between the two metals has raised expectations on the platinum. Furthermore, the spread of stricter rules on polluting vehicles causes an increase in demand for platinum used both in the catalytic converters of diesel vehicles and in hydrogen cars. These models exploit the platinum inside the fuel cells that produce electricity from a reaction between hydrogen and oxygen.

Other aspects of the market would play a role in the rise of platinum, whose futures are traded on the New York commodities exchange and of which South Africa is a major extractor. According to observers, there may be a global production deficit for the third year in a row, explains Reuters, after almost 400,000 ounces were missing from the appeal last year, according to the latest PGM report. All this while in 2020 China's automobile sales increased 30% in January year-over-year, for the tenth consecutive month of growth. Not for nothing, even another industrial metal such as copper has reached unexplored heights since 2012.

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