Platinum prices, already on the positive track, got a boost this week from declining greenback and the announcement of GM’s Bankruptcy. GM’s bankruptcy is by no means a positive for platinum, as the auto industry accounts for approximately half of global platinum demand; however, platinum’s price has been reflecting the impending bankruptcy for many weeks.
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Platinum declined last week; and continued the trend this Monday as uncertainty over the future of US automaker GM put the metal’s near future demand outlook into question. In the current state of the economy, the auto industry is unable to lend support to platinum; but the metal may get some relief from rising safe haven appeal.
Platinum is on track for the best quarter in over a year, as demand for the metal as an alternative to gold has nudged prices up 23 per cent. Platinum’s premium to gold stood at $213.15 an ounce yesterday, compared with $1,041.83 a year ago.
Monday’s equity market rally switched precious metals to a negative track. As equities rose, the precious metals were less enticing to investors, and this was reflected in their value. Platinum for April delivery ended the session in New York down $14.20 to $1,049.40 per troy ounce.
Platinum is known as "high-octane gold", for its stronger price moves and prospects for a higher upside. Platinum is essential to the economies of many industrialized nations, globally, demand for platinum is the sum of; investment demand, industrial demand, and jewellery demand.