Palladium Extends Gains to One-Week High

Palladium futures gained to around 1,350 per ounce, extending gains to a one-week high, as a weaker US dollar and renewed demand for precious metals supported prices. The dollar weakened after the US Treasury unexpectedly increased long-dated debt buybacks, with Treasury Secretary Scott Bessent signaling purchases could exceed $4 billion per issue, initially easing yield pressures and supporting non-yielding metals. Palladium also benefited from broader precious-metals gains, with gold on track for a third straight weekly gain. However, rebounding Treasury yields and higher energy prices could limit gains by keeping inflation risks and rate-hike expectations elevated. Meanwhile, heightened tensions between the US and Iran, including threats of tougher economic measures, supported safe-haven demand. On the supply side, concerns over lower Russian palladium output and reduced refined production from South African processing disruptions continued to provide underlying support.

Palladium futures hovered near $1,320 per ounce, rebounding from recent lows, as a drop in bond yields from multi-year highs boosted the appeal of non-yielding metals. The US Treasury announced it will increase its buyback operations, pushing borrowing costs lower and boosting demand for non-yielding metals. On the supply side, concerns over power supply disruptions and uncertainty surrounding Russian exports continued to underpin prices. Meanwhile, uncertainty over shipments through the Strait of Hormuz kept industrial buyers cautious. Although rising hybrid vehicle demand has provided near-term support for autocatalyst consumption, markets remain cautious amid the broader shift in demand toward EVs, which recorded a fifth consecutive monthly increase in July, as the palladium market could still record a global surplus.

Palladium futures slipped below $1,330 per ounce after hovering near a two-month high, weighed by concerns over the long-term impact of growing electric vehicle demand. Although rising hybrid vehicle demand has provided near-term support for autocatalyst consumption, markets remain cautious amid the broader shift in demand toward EVs, which recorded a fifth consecutive monthly increase in July, as the palladium market could still record a global surplus. Meanwhile, uncertainty over shipments through the Strait of Hormuz kept buyers cautious on the industrial front. On the other hand, concerns over power supply disruptions and maintenance bottlenecks at South African mines, alongside uncertainty surrounding Russian exports, continued to underpin prices.