NEW YORK (Scrap Register): Platinum group metals have fallen to multi-month lows amid worries about key producer South Africa after the country’s finance minister was accused of fraud this week.
Nymex January platinum was down $4.60 to $941.20 an ounc, its lowest level since March. While December palladium had gained $2.90 to $651.05, the contract has fallen as far as $645.75, its weakest level since July.
“Prices are no doubt facing headwind from South Africa, where the South African rand is depreciating significantly because the country’s finance minister appears to be facing imminent dismissal,” said Commerzbank.
News that the minister had been summoned to court over alleged fraud catapulted the dollar against the rand and helped to significantly undermine confidence in platinum group metals during a sell-off on Tuesday, said MKS (Switzerland) S.A.
“This is overshadowing other price-supportive news,” Commerzbank added.
For instance, the bank cited data from the China Association of Automobile Manufacturers showing that 2.27 million cars were sold in China in September, which is 29% more than in the same month last year. This means more industrial demand for the metals since they are used in auto catalysts.