Platinum prices have made solid gains during overnight trading and have reached the highest levels since mid-June. The discount of platinum prices to gold prices was a short-lived condition, and might have created fresh awareness of platinum as an alternative to expensive gold prices. While platinum continues to trade with the characteristics of a physical commodity market, the platinum market has more than kept pace with gold as the spread was roughly $45 an ounce premium for platinum. Given the relatively smaller structure of the platinum market and its derivative instruments, it is possible that a noted influx of investment demand for platinum could considerably tighten supply. China announced plans to allow foreign investors to use the Yuan to buy Chinese securities, which may help to increase Chinese industrial platinum demand during the rest of 2011.
Join the Discussion