Platinum Holds at 5-Week Low

Platinum futures held below $1,760 an ounce after dropping more than 4% in the previous session to a five-week low, as higher Treasury yields and dollar strength reduced demand for the non-yielding metal. The selloff followed stronger-than-expected US business activity data, reinforcing expectations for higher interest rates. The 10-year US Treasury yield climbed to its highest level since 2007, while the dollar strengthened as markets raised bets on another Federal Reserve rate hike at the October meeting. Rising oil prices also added to inflation concerns, after Iran's President said Tehran would keep the Strait of Hormuz closed while US sanctions and the blockade remain. Still, platinum's fundamentals remain supportive, with above-ground stocks forecast to cover just 3.4 months of demand by year-end despite a projected 265,000-ounce surplus in 2026. Industrial demand is expected to rise 5%, driven partly by AI-related glass and electrical applications.

Platinum futures held near $1,800 an ounce, halting its recent gains as easing inflationary pressures from retreating oil prices offset a firmer US dollar. Oil prices continued to decline amid signs of increased diplomatic efforts to resolve the conflict and restore energy flows in the Middle East. This eased concerns over inflation and the prospect of further interest rate hikes, lowering the opportunity cost of holding platinum. Meanwhile, hawkish comments from Federal Reserve officials reinforced expectations for a tighter US interest-rate outlook following last week’s first rate hike in three years. Underlying fundamentals remained supportive, with WPIC forecasting a 5% increase in industrial demand in 2026, partly driven by AI infrastructure, although automotive demand is forecast to fall 4%. Despite a projected 265k oz surplus in 2026, WPIC also expects above-ground stocks to remain at only about 3.4 months of global demand, following the large deficits of previous years.

Platinum futures rose above $1,800 an ounce, advancing for a third consecutive session as retreating oil prices lifted demand for non-yielding metals. Oil prices continued to fall amid signs of increased diplomatic efforts to resolve the conflict and restore energy flows in the Middle East. This eased concerns over inflation and the prospect of further interest rate hikes, lowering the opportunity cost of holding platinum. Investors now assessed the Federal Reserve’s policy outlook, with several officials appearing this week after the central bank raised rates last week for the first time in three years. Meanwhile, platinum supply remains structurally constrained, with WPIC expecting deficits to average 331,000 oz annually from 2026-2030, despite a moderate surplus in 2026 forecast. Industrial demand remains supportive, including applications in emissions control, hydrogen and emerging AI technologies, though the shift toward BEVs poses a long-term headwind for autocatalyst demand.