Platinum reached an almost 10-month high on signs increased demand from car companies will add to a supply shortage. Gold held below the highest in three months.
Investor holdings in platinum- and palladium-backed funds are at or near records as demand from automakers and a South African mining strike that lasted five months leads to a third successive supply deficit. U.S. auto sales adjusting for seasonal trends accelerated to an annualized pace of 16.98 million in June, the fastest in almost eight years, researcher Autodata Corp. said yesterday.
About 220,000 members of the National Union of Metalworkers of South Africa stopped work yesterday to support their request for pay increases. The protests come after a platinum strike that lasted from January to June. The country is the largest producer of the metal, which is mainly used alongside palladium in car pollution-control devices.
“Investors acknowledge the difficulties that the South African platinum sector faces beyond the resolution,” UBS AG analysts wrote in a report today. “Participants will be keeping an eye out for any signs of tightness in the months ahead.”
Platinum for immediate delivery rose 0.5 percent to $1,516.63 an ounce by 11:28 a.m. in London, according to Bloomberg generic pricing. It reached $1,519.38, the highest since Sept. 4. The metal for October delivery added 0.3 percent to $1,518.90 on the New York Mercantile Exchange.