Platinum Pressured Near 3-Week Lows

Platinum futures traded around $1,950 an ounce, hovering near three-week lows as heightened uncertainty in the Middle East kept inflation risks elevated. Even as negotiations proceeded, US forces conducted strikes in southern Iran in what it described as defensive actions, dimming hopes of a potential peace deal. This sent oil prices higher, fueling inflation concerns and reinforced expectations that central banks could maintain tighter monetary policy for longer. Meanwhile, platinum draws support from its favorable supply-demand outlook. Strong demand from China, particularly following the launch of a new domestic platinum futures contract, has reinforced investor interest in the metal. The market also remains structurally tight, with output in major suppliers South Africa and Russia constrained by aging mines, high operating costs, and sanctions-related challenges. Expectations of solid industrial demand from the automotive sector, further added support.

Platinum futures rose to above $1,950 an ounce, attempting to rebound from a three-week low as signs of progress in US-Iran negotiations eased concerns about inflation and further interest rate hikes. Reports indicated that the proposed deal could reopen the Strait of Hormuz, raising hopes that energy supply disruptions may ease. However, President Donald Trump said the US would keep its blockade of the key waterway in place until a formal agreement is finalized. Meanwhile, platinum continued to draw support from its favorable supply-demand outlook. Strong demand from China, particularly following the launch of a new domestic platinum futures contract, has reinforced investor interest in the metal. The market also remains structurally tight, with output in major suppliers South Africa and Russia constrained by aging mines, high operating costs, and sanctions-related challenges. Expectations of solid industrial demand from the automotive sector, further added support.

Platinum futures fell to around $1,940 an ounce in mid-May, hitting their lowest level in three weeks, tracking broader weakness across precious metals amid rising concerns about US inflation. Expectations of a Fed rate hike this year strengthened and the dollar firmed due to mounting inflationary pressures driven by the prolonged Iran war and the ongoing closure of the Strait of Hormuz. Adding to the pressure, China’s industrial output grew 4.1% year-on-year in April 2026, slowing sharply from a 5.7% gain in March and marking the weakest growth since July 2023. Despite the pullback, platinum has seen a recent rally and outperformed other precious metals due to stronger industrial demand expectations tied to autocatalyst use and hybrid vehicle demand. The market also remains structurally tight, as production in South Africa and Russia, the two largest suppliers, faces ongoing challenges, including aging mines, high costs, and sanctions.