Palladium price slumps to lowest in three months amid concerns over demand
Taiwan (Oct 23) Palladium futures tumbled to the lowest in more than three months amid signs of weakening investment and physical demand for the metal used in car pollution control devices.
Automobile and parts dealer sales fell 0.5 percent in August to C$10.9 billion (US$8.17 billion), leading the third straight decline in Canada’s retail sales, Statistics Canada said on Friday in Ottawa.
In the US, sub-prime borrowers are falling behind on their car loan payments at the highest rate in more than six years, S&P Global Ratings said earlier this month.
Palladium, used in gasoline engines, has slumped from a one-year high in August, in part as investors price in increasing probability that the US Federal Reserve might raise interest rates by the end of the year, curbing the investment appeal of non-interest bearing precious metals.
Money managers are getting more pessimistic about the outlook on palladium, cutting their net-long positions on palladium in seven of the past nine weeks.
“Demand is really starting to fall,” said Phil Streible, a senior market strategist at RJO Futures in Chicago.
“You’re going to see that as interest rates go up in the US, auto loan rates will rise and you’re probably going to see automobile sales decline,” he said.
Palladium futures for December delivery slipped 1.9 percent to settle at US$620.75 an ounce (28.3g) at 1:10pm on the New York Mercantile Exchange, after touching US$615.10, the lowest for a most-active contract since July 12.
Other precious metals:
Gold for December delivery on Friday gained less than 0.1 percent to US$1,267.70 an ounce on the Comex in New York.
The contract is up US$12.2, or 0.9 percent, from last week’s US$1,255.50.
Silver for December delivery settled at US$17.493 an ounce on Friday, up 0.3 percent from last week’s US$17.441.
Gold-backed exchange-traded funds expanded for a seventh session, taking assets to the highest in more than three years.
On the Nymex, platinum futures declined 0.3 percent.
Basic metals:
Copper futures had an eighth straight decline on Friday, the longest losing streak since 2014, amid persistent signs of oversupply in the market.
On the London Metal Exchange, copper for delivery in three months fell 0.4 percent to US$4,652 per tonne.
Nickel fell 0.8 percent to US$10,045 a tonne in London having earlier touched the lowest price in two weeks. The metal came under pressure after China’s top stainless steel producer said it plans to cut output.
Aluminum climbed for the first time in six days in London, trimming this week’s loss to 3.5 percent.
Source: TeipeiTimes
