Perhaps overlooked in the precious-metals market with gold hitting record highs is the recent rally in exchange traded funds tracking platinum and palladium.

BofA Merrill Lynch analysts point out that platinum and palladium bullion stored in Switzerland is experiencing small outflows year to date and global inventory levels for both precious metals remain below recent highs, which has helped support prices, reports Nick Johnson for Platts News.

Additionally, the recovery in the auto industry has also helped platinum and palladium prices, since both metals are used in the production of catalytic converters for car engines. BofA Merrill Lynch analysts project that sales will reach 74 million units for 2011, with almost half that amount coming from emerging market demand.

“We anticipate China’s platinum demand to remain healthy,” said the analysts. Additionally, imports to Japan have “held up remarkably well” and U.S. platinum and palladium imports are above last year’s levels, the analysts noted.