LONDON: Palladium and platinum rose sharply on Wednesday as bets on lower prices were reversed in thin conditions after the metal broke above key chart levels, while gold rose as weak US data weighed on the dollar.
Gold, often perceived as a hedge against economic and financial risk, was 0.84 per cent higher at $1,351.50 an ounce.
Palladium surged overnight in Asia, hitting 14-month highs. Traders said a wave of short covering was likely triggered after the metal broke above $700 an ounce, and then above last week’s 14-month peak of $723 an ounce.
Spot palladium was up 4.75 per cent at $726.97 ounce at 1511 GMT, having risen as high as $746.10 an ounce in Asian trading hours. The move was likely to have been exacerbated by thin liquidity, analysts said.
Palladium, used in catalytic converters in cars, climbed nearly 20pc last month in its biggest one-month rise in 8-1/2 years.
Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell for a second straight day on Tuesday. They slipped 0.12pc to 972.62 tonnes from Monday.
Among other precious metals, platinum was up 2.17pc at $1,174.80 after rising to $1,191.70, its loftiest in over 17 months, while silver was up 1.98pc at $20.22 an ounce.