“Platinum has many factors supporting a positive outlook including higher gold prices, stable South African Rand, rising global industrial production, and anticipated higher Chinese demand for diesel ahead of tougher emission standards,” Gold said.
Palladium has also enjoyed a strong rebound this year, and investors have been a major factor to the trend.
“A key factor is the continued physical deficit driven by rising demand and weak mine supply,” Gold said. “Above ground supplies such as exchange-traded funds continue to be sourced to meet demand, with tightness in the palladium market sparking 3 month lease rates to surge over 20% in June. Despite attractive fundamentals and performance, investors remain absent. If investors begin to move into the market, prices may move higher creating a new leg in the current rally.”
Investors interested in gaining exposure to the two precious metals may look to physically backed commodity-related ETFs, like the ETFS Physical Platinum Shares (NYSEArca: PPLT) and ETFS Physical Palladium Shares (NYSEArca: PALL).
For more information on the metals market, visit our precious metals category.