NEW YORK (Reuters) – Platinum’s discount to fellow precious metal palladium reached its highest level since 2001 on Thursday, as the latter soared on heightened vehicle demand and an ongoing supply deficit.
Palladium hit a high of $1,022.70 on Thursday, just off a 16-year high from last week, while platinum hit a low of $887.50 per ounce, putting it on track for its biggest weekly loss in nine months.
The platinum discount widened to around $120 on Thursday, the steepest since April 2001, according to Reuters data going back to 1985. “Palladium is powering on with the demand for more vehicles,” said George Gero, managing director of RBC Wealth Management in New York.
“There’s more need for palladium, which cannot be reclaimed as easily or as often from junked automobiles as platinum.”
Both platinum and palladium are used in catalytic converters in car exhaust systems. However, palladium is in higher demand in the United States and the Caribbean, particularly lately, as consumers replace vehicles damaged in recent storms, Gero said.