Platinum, Palladium Gain as Gold Rises to Record on Dollar Drop
Source: Bloomberg, Halia Pavliva (10/6/09)
"The U.S. dollar is taking an incredible beating."
Some investors buy precious metals to preserve value when the U.S. currency declines. The dollar fell as much as 0.7% against the euro, weakening for a third straight session. Gold jumped on speculation that the greenback may lose its place as a global reserve and trading currency, accelerating inflation.
"The U.S. dollar is taking an incredible beating,"’ Miguel Perez-Santalla, a Heraeus Precious Metals Management sales vice president in New York, said in a note. "Gold has gotten a tremendous boost on this. The other metals rallied along."’
Platinum futures for January delivery rose $18.80, or 1.4%, to $1,320.60 an ounce at 10:38 a.m. on the New York Mercantile Exchange. Before today, the most-active contract gained 38% this year.
Palladium futures for December delivery advanced $3.15, or 1%, to $306.45 an ounce. Through yesterday, the price climbed 61% this year.
Canaccord Capital Corp. has raised its platinum forecast to $1,350 an ounce for the current quarter from $1,250, mainly because of the rising value of the South African rand compared with the dollar, analysts Tyler Broda in Vancouver and Damien Hackett in London said today in a report. Most of the world’s platinum comes from mines in South Africa.
The analysts said the metal is forecast to be at $1,450 an ounce in the second half of 2010.