Yahoo Finance This metal is becoming the ‘most precious of precious metals’
Named after the asteroid Pallas, the precious metal palladium is currently enjoying a stratospheric rise to make its namesake proud.
Spot palladium gained 18.6 per cent last year and is up a staggering 124 per cent since the beginning of 2016.
And at $US1,337 an ounce, it’s currently worth more than gold ($US1,287 an ounce).
And it’s now worth more than $US500 more than its rival, platinum ($US826 an ounce), marking a major new record.
What’s going on?
The white metal is largely used by vehicle manufacturers to reduce pollution from gasoline internal combustion engines. As concerns about global pollution have increased, so has demand for palladium.
“Not even the 2018 slowdown in China’s auto market, the world’s largest, dampened demand,” CEO of Sprott Asset Management John Ciampaglia said.
“Palladium is close to becoming the most “precious” of precious metals.”
The precious metal’s rise has also partially had platinum to thank. Historically more expensive, platinum used to be vehicle manufacturer’s primary choice.
But in the last decade automakers have developed technology which achieves nearly the same results with palladium, Ciampaglia said.
Will it continue?
We’ve been tracking palladium’s price for the last few months, and while its rise has been spectacular, most commentators agree its price has been largely fueled by supply-side issues.
“Palladium, unlike gold which is seen as a monetary metal and demand is driven by industrial uses,” ABC Bullion’s Jordan Eliseo told Yahoo Finance.
“Supply concerns have compounded the issue, forcing prices higher.”
Speaking to Bloomberg, the head of analysis at Russia’s Norilsk Nickel, Anton Berlin said it’s also unlikely that vehicle manufacturers will switch back to platinum as palladium has some features making it more suitable for hybrid cars.
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