Palladium prices and commodity-related exchange traded funds are strengthening as auto sales are set for another record year.

The ETFS Physical Palladium Shares (NYSEArca: PALL) jumped 4.6% Friday after surging 51.2% over the past year and strengthening 10.7% year-to-date.

Maxwell Gold, Director of Investment Strategy at ETF Securities, in a note argued that palladium’s rise has been driven by a very strong outlook for continued global auto sales in 2017.

U.S. auto sales for 2016 revved up on declining gas prices, rising employment and low interest rates, marking the industry’s seventh successive year of sales gain.

According to Scotiabank, auto sales are expected to hit another record in 2017 for the eighth consecutive year on rising demand in emerging markets and from those in the U.S. seeking to replace older vehicles as stronger global economic growth and low gas prices help support consumer demand.

“Strong global auto sales expected this year,” ETFS’ Gold said. “Palladium is a key component in gasoline engine autocatalysts, which are widely used in US and Chinese markets.

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