Platinum Stays Near November Lows

Platinum futures traded around $1,650 an ounce, staying near late-November lows as investors weighed easing geopolitical risks in the Middle East against persistent expectations of higher US interest rates. Despite leaving interest rates unchanged last week, markets continued to price in a Fed rate hike later this year following recent hawkish signals from officials, weighing on non-yielding assets such as platinum. However, diplomatic efforts in the US-Iran conflict and discussions over the potential reopening of the Strait of Hormuz provided support across the precious metals complex. At the same time, the long-term supply outlook remained supportive, with the platinum market still expected to post another annual deficit. South African producer Valterra Platinum also reported a sharp rise in interim profit, citing stronger platinum-group metal prices and growing demand from AI-related infrastructure, which it expects to increase significantly over the coming years.

Platinum futures traded near $1,630 an ounce, after touching a six-week high of $1,660 as precious metals broadly advanced amid renewed hopes of a peace deal in the Middle East. US President Trump said talks with Iran will resume and revealed he had called off a planned large-scale attack following requests from regional allies. Additional support came from a weaker dollar after Japan intervened to support the yen, making dollar-priced metals more attractive to overseas buyers. Meanwhile, markets continued to price in a Federal Reserve rate hike later this year despite policymakers leaving interest rates unchanged last week, as several officials warned that waiting too long could require more aggressive tightening. Platinum's gains were also tempered by expectations of weaker industrial and automotive demand, particularly as the shift toward electric vehicles reduces the need for autocatalysts, even though the market is expected to post a fourth consecutive annual supply deficit.

Platinum futures hovered around $1,630 an ounce, pressured near late-November lows as softer industrial demand and inflationary risks stemming from the Middle East war weighed on the market. The conflict has kept energy prices elevated, fueling inflationary pressures and reinforcing expectations that interest rates will remain higher for longer, reducing the appeal of non-yielding assets such as platinum. Although the US Federal Reserve left interest rates unchanged, Chairman Kevin Warsh warned that higher interest rates could become an appropriate policy response if inflation remains elevated. The platinum market was also weighed down by expectations for softer industrial and automotive demand despite the tight supply outlook. The ongoing shift toward electric vehicles, which do not require autocatalysts, has clouded demand prospects even as the market is forecast to post a fourth straight annual supply deficit due to constrained mine supply and declining above-ground inventories.