LONDON (Reuters) – Platinum prices tumbled to 10-year lows as the collapse of Turkey’s lira rippled through markets and weakened the currency of top producer South Africa, underlining persistent oversupply of the autocatalyst metal.
Platinum has been caught in a broad sell-off as investors rush to the safety of the dollar, pushing it higher and making dollar-priced metals more expensive for buyers using other currencies.
But platinum, used mainly in emissions-reducing catalytic converters for vehicles and in jewelry, has fallen further than its precious metal peers.
Once much more valuable than gold and palladium, platinum has tumbled 25 percent from January highs to below $780 an ounce. This week it hit its lowest since October 2008 and a new record low relative to gold.
“It (platinum’s outlook) has changed and the reason is the weakness of the rand,” said Julius Baer analyst Carsten Menke. The rand has fallen more than 10 percent against the dollar in a week, boosting the local earnings of South African companies who produce around 70 percent of the world’s mined platinum and relieving pressure on them to cut output.
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