Platinum futures rose to $1,020 per ounce, approaching the three-month high of $1,032 touched on January 31st and rising more than 12% since the start of the year, extending the rally for bullion as stronger demand for safety and looser monetary policy by major central banks momentarily offset concerns over slowing industrial demand.
Platinum rises toward three-month high
Investors sought refuge in precious metals after US President Trump expanded on earlier tariff threats by including restrictions on steel and aluminum, alongside matching tariffs against any country imposing trade restrictions on the US. The potential for escalating trade disputes raised fears of supply chain disruptions and broader economic uncertainty, boosting demand for safe-haven assets like platinum.
Eyes on the Fed
On the policy front, expectations of lower interest rates by the Federal Reserve, the Reserve Bank of China (RBC), the People’s Bank of China (PBoC), and the Reserve Bank of India (RBI) supported precious metals by making yield-less assets more attractive. A weaker dollar, driven by easing monetary policy expectations, also provided tailwinds for platinum prices.
Still, platinum's gains were limited by concerns over the ongoing transition away from internal combustion engine vehicles, which utilize platinum in catalytic converters. The shift toward electric vehicles (EVs) continued to weigh on long-term demand prospects for the metal, as evidenced by China’s subsidized new vehicle exchange program, where more than 60% of purchases were for plug-in hybrid or fully electric models. However, platinum’s role in hydrogen fuel cells has sparked renewed interest, with some analysts projecting increased demand from the green energy sector in the coming years.
Supply-side factors role
Meanwhile, supply-side factors also played a role in price movements, with disruptions in South Africa—one of the world’s top platinum producers—raising concerns about future output. Labor strikes, power shortages, and geopolitical risks in key mining regions could tighten supplies, providing additional support for platinum prices in the near term.
