President Donald Trump has promised lower taxes and increase spending, which could further propel consumer demand for automobiles and support higher palladium prices.

Along with its safe-haven link in the precious metals space, palladium is also more sensitive to economic cycles and enjoys heavy industrial demand, notably out of the automobile industry where the precious metal is used as an autocatalyst to remove harmful emission particles.

“Traders reported a reluctance to lend the metal, suggesting tightness in near-term supply. Chart patterns indicate that the metal is vulnerable to a sell-off from these elevated levels, however, technical analysts said,” according to Reuters.

Palladium supply is expected to be in a deficit this year, marking the sixth straight year the metal has been in a deficit.

For more information on the palladium market, visit our palladium category.