Palladium Holds Near Eight-Month Lows

Palladium traded around $1,250 per ounce, lingering near eight-month lows, as precious metals remained under pressure amid renewed Middle East tensions. Fresh US strikes pushed oil prices higher, fueling inflation concerns and casting doubt on a fragile ceasefire and broader peace prospects, while the Strait of Hormuz remained nearly closed. Rising energy costs heightened inflation fears and the risk of further central bank tightening, weighing on non-yielding assets. Additionally, palladium faced pressure from weaker catalytic converter demand due to the shift toward electric vehicles. However, losses were capped by tight supply conditions, including disruptions in South Africa and uncertainty over Russian exports.

Palladium decreased 5.21% to 1265.5 USD/t.oz

Palladium hovered near $1,300 per ounce, retreating after recent gains to trade near an eight-month low as investors reassessed the outlook for US monetary policy and global economic conditions. Sentiment across the platinum-group metals complex weakened as higher energy prices fueled inflation concerns, reinforcing expectations of elevated interest rates. Additional pressure came from a stronger US dollar, which advanced for a third consecutive session after Federal Reserve officials signaled that borrowing costs may need to stay elevated if inflation proves persistent. Market participants also turned their attention to upcoming US labor market data for further clues on the Fed's policy path. Beyond macroeconomic pressures, palladium remained weighed down by weaker catalytic converter demand amid the shift toward electric vehicles. Still, losses were limited by tight supply conditions, including disruptions in South Africa and uncertainty surrounding Russian exports.