Platinum Hits 3-Month Low

Platinum futures fell around $1,600 an ounce, reaching their lowest level in three months as renewed energy-driven inflation risks pressured the precious metals complex. Crude prices rose as escalating Middle East tensions raised concerns over oil supply disruptions, reviving fears that higher energy costs could keep inflation elevated and force central banks to maintain tighter monetary policy. Higher interest rates typically weigh on non-yielding metals by increasing the opportunity cost of holding them. Investors are now watching the Federal Reserve’s upcoming policy meeting for clues on the interest-rate outlook. Platinum also faces fundamental headwinds, with the World Platinum Investment Council forecasting a 265,000-ounce market surplus in 2026, as weaker investment demand and softer jewelry consumption weigh on the outlook. Automotive demand is also expected to decline 4%, partly offset by a projected 5% increase in industrial demand.

Platinum futures rose above $1,640 an ounce, recovering from a recent three-month low, as safe-haven demand amid expectations of higher-for-longer interest rates supported the market. Signs of persistent inflationary pressures strengthened the case for the Fed to keep rates elevated for longer, raising concerns over capital-intensive sectors, namely the AI buildout, and supporting demand as investors seek shelter. Meanwhile, global EV sales fell 2% in September, ending six consecutive months of growth, according to Benchmark Mineral Intelligence data. Slower EV adoption could support platinum demand by easing the shift away from combustion-engine vehicles, although resilient hybrid sales have helped cushion the decline. Over the longer term, however, higher rates could exert greater downward pressure in demand for the metal that carries no yield. Additionally, the WPIC sees total demand falling 18%, including a 32% drop in Chinese jewelry demand and a 4% decline in automotive demand.

Platinum futures traded below $1,630 an ounce, approaching its lowest level in three months amid persistent investment outflows and a bearish long-term outlook. Strong US inflation strenghened the case for the Fed to keep borrowing costs elevated for longer, raising concerns over capital-intensive sectors, namely the AI buildout, and providing some support as investors seek shelter. Over the longer term, however, higher rates could exert greater downward pressure in demand for the metal that carries no yield. Additionally, the WPIC sees total demand falling 18%, including a 32% drop in Chinese jewelry demand and a 4% decline in automotive demand, although resilient demand for hybrids has helped moderate the decline. Despite this, the drop in demand continues to underpin a bearish outlook for the metal as it outpaces the contraction in supply, with elevated operating costs and power grid instability in South Africa, alongside ongoing trade risks in Russia, constraining production.