Platinum Hits Eight-Week Low

Platinum futures fell below $1,720 an ounce, reaching their lowest level in eight weeks, as rising oil prices boosted bets on higher-for-longer interest rates and weakened investment demand. Diplomatic talks between the US and Iran over the Strait of Hormuz stalled after President Trump rejected Tehran’s proposal to reopen the critical waterway, while stating that talks would resume this week. As a result, oil prices advanced and expectations of further monetary tightening by the Federal Reserve increased, raising the opportunity cost of holding the non-yielding metal. Meanwhile, the platinum market is forecast to post a 265,000-ounce surplus, marking the first surplus since 2022, according to the WPIC, as a 5% increase in industrial demand is expected to offset a 4% decline in demand from carmakers. Over the longer term, demand will be underpinned by the rapid build-out of artificial intelligence.

Platinum futures fell below $1,740 an ounce, approaching a six-week low as surging Treasury yields and dollar strength reduced demand for the non-yielding metal. The selloff followed stronger-than-expected US business activity data and elevated oil prices, fueling concerns over persistent inflation and higher interest rates. The 10- and 30-year US Treasury yields rose to their highest levels since 2007 and 2004, respectively, while the dollar climbed to a near two-month high as markets priced in 67% odds of a Federal Reserve rate hike in October, following the first increase in three years last week. Oil prices also remained elevated as uncertainty persisted over whether the US and Iran could reach a truce soon, keeping global inflation risks in focus. Meanwhile, platinum’s industrial fundamentals remain mixed as WPIC forecasts industrial demand to rise 5% in 2026, while automotive demand is expected to fall 4%. The market is also forecast to post a 265,000-ounce surplus this year.

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.