FX.co ★ Platinum Remains Subdued

Platinum prices fell below $1,545 per ounce as the probability of the Federal Reserve implementing a rate cut in December has been revised to approximately 50%, a sharp decrease from about 90% a month ago. This adjustment comes after several Federal Reserve officials expressed hesitation over easing monetary policy. Market participants are now looking to Thursday’s employment report and the release of delayed US economic data for new insights. This shift in the policy outlook has impacted a market that had increased more than 70% this year due to tight supply and robust industrial demand. In the short term, physical demand has weakened as automakers adjust their metal usage, and the long-term transition to electric vehicles decreases the need for catalysts used in combustion engines. Improved transparency regarding Chinese inventory levels and initial signs of a revival in South African production have diminished the scarcity premium, leading investors and ETFs to reduce their positions. With the US dollar strengthening and global interest rate expectations on the rise, non-yielding metals are experiencing further selling pressure.