Among precious metals exchange traded products this year, gold and silver funds are grabbing most of the headlines, but investors should not sleep on palladium. For example, the ETFS Physical Palladium Shares (NYSEArca: PALL) is higher by nearly 15% year-to-date.
Supporting the recent bounce in palladium prices, the China Association of Automobile Manufacturers revealed China’s car market is performing better than expected, with car sales in China jumping 9.8% and its best monthly growth year-over-year, China Business News reports.
As growth improves and inflation rises, we are back to waiting for an eventual Federal Reserve interest rate hike, which may trigger market fears over policy mistakes and potential pressure growth.
For the precious metals market, traders will have to keep close tabs on the Fed as gold has been closely correlated to real interest rates. We have seen gold outperform in negative interest rate periods.[related_stories]
Platinum and palladium also enjoy heavy industrial demand, notably out of the automobile industry where the precious metal is used as an autocatalyst to remove harmful emission particles.