[SMM Platinum and Palladium Weekly Review] Last week (March 16–March 20), NYMEX benchmark platinum fell 5.97% during the week to $1,920.1/oz, and NYMEX benchmark palladium fell 10.46% during the week to $1,414.5/oz. On the GFEX in China, the most-traded platinum futures contract PT2606 opened at 530 yuan/gram and closed at 509.75 yuan/gram, down 42.3 yuan/gram from the previous week's settlement price, a decline of 7.66%, with a highest price of 568 yuan/gram and a lowest price of 503.2 yuan/gram during the week; the most-traded palladium futures contract PD2606 opened at 396.15 yuan/gram and closed at 368.85 yuan/gram, down 47.3 yuan/gram from the previous week's settlement price, a decline of 11.37%, with a highest price of 416.95 yuan/gram and a lowest price of 368.2 yuan/gram during the week. In futures trading, the most-traded platinum futures contract PT2606 recorded total trading volume of 39,488 lots during the week, with total turnover of 21.036 billion yuan, open interest of 18,516 lots, and open interest decreased by 1,473 lots WoW. The most-traded palladium futures contract PD2606 recorded total trading volume of 16,539 lots during the week, with total turnover of 6.46 billion yuan, open interest of 7,848 lots, and open interest increased by 236 lots WoW. [SMM Platinum and Palladium Weekly Review] Last week (March 16–March 20), NYMEX benchmark platinum fell 5.97% during the week to $1,920.1/oz, and NYMEX benchmark palladium fell 10.46% during the week to $1,414.5/oz. On the GFEX in China, the most-traded platinum futures contract PT2606 opened at 530 yuan/gram and closed at 509.75 yuan/gram, down 42.3 yuan/gram from the previous week's settlement price, a decline of 7.66%, with a highest price of 568 yuan/gram and a lowest price of 503.2 yuan/gram during the week; the most-traded palladium futures contract PD2606 opened at 396.15 yuan/gram and closed at 368.85 yuan/gram, down 47.3 yuan/gram from the previous week's settlement price, a decline of 11.37%, with a highest price of 416.95 yuan/gram and a lowest price of 467.7 yuan/gram during the week. In futures trading, the most-traded platinum futures contract PT2606 recorded total trading volume of 39,488 lots during the week, with total turnover of 21.036 billion yuan, open interest of 18,516 lots, and open interest decreased by 1,473 lots WoW. The most-traded palladium futures contract PD2606 recorded total trading volume of 16,539 lots during the week, with total turnover of 6.46 billion yuan, open interest of 7,848 lots, and open interest increased by 236 lots WoW.
Recently, the core logic driving platinum and palladium prices has centered on the US Fed's monetary policy, safe-haven demand and inflation amid geopolitical tensions, trade policy uncertainty, economic stagflation and financial market risks, as well as the upward shift in the cost center on the supply side.
As geopolitical conflict in the Middle East continued to escalate, the precious metals market as a whole entered a stagflation panic mode. The specific logic is that the greater-than-expected US-Iran conflict pushed up oil prices, thereby triggering concerns over imported inflation in the US and, in turn, delaying the Fed's interest rate cut path. On US Fed monetary policy, the March FOMC meeting concluded with the rate decision keeping the target range for the federal funds rate unchanged at 3.50%-3.75%; Miran dissented and advocated an immediate 25-basis-point interest rate cut, while Warsh chose to wait and see. Powell believed that the current policy rate was at the upper end of the neutral range. Economic projections showed that, on inflation, the median expectation for core PCE inflation at the end of 2026 was raised by 0.2 to 2.7, while headline PCE was also raised by 0.3 to 2.7; on growth, the 2026 GDP growth expectation was raised from 2.3 to 2.4; on the rate path, the forecasts for a 25-bp interest rate cut in 2026 and another 25-bp cut in 2027 were maintained, while the long-run equilibrium rate was raised by 0.1 to 3.1. The overall pace of interest rate cuts was pushed back further.
Regarding the US-Iran conflict, the US and Israel launched sustained, high-intensity airstrikes on Iranian territory, targeting missile positions, military-industrial facilities, and energy ports. Iran then mounted a full-scale retaliation, designating energy facilities in multiple Gulf countries as targets, while shipping security in the Red Sea and the Strait of Hormuz came under severe threat. On March 21, Trump gave Iran 48 hours to open the Strait of Hormuz without posing any threat, or else its power plants would be destroyed. On March 22, Iran’s Khatam al-Anbiya Central Headquarters stressed that if Iran’s fuel and energy infrastructure were attacked by the enemy, all energy infrastructure, information technology systems, and seawater desalination facilities of the US and its allies in the region would become targets. There was currently no room for negotiations or a ceasefire, and the risk of conflict escalation remained high.
On tariffs, after the US reciprocal tariff was overturned by the Supreme Court, policy uncertainty increased. The Trump administration was seeking a more solid legal basis to reconstruct the tariff system: in the short term, it would use temporary tariffs under Section 122 to fill the tariff-rate vacuum; in the medium and long term, it planned to rely on Sections 232 and 301 to maintain a high-tariff framework. Citing “overcapacity,” the USTR launched Section 301 investigations into 16 economies, including China. On March 16, the Chinese and US economic and trade teams held consultations, and both sides agreed to maintain the stability of bilateral economic and trade relations. In addition, the ruling that the tariffs were illegal triggered pressure for massive tax refunds, aggravating the US fiscal burden and reinforcing expectations for a weaker US dollar.
Supply side, Eskom will raise electricity prices by 8% in each of the next two years, and has recently frequently announced breakdowns in negotiations with the mine side, leading some miners to shut down their international operations and sparking concerns over supply disruptions in platinum and palladium.
Strategy-wise, we continued to maintain a strategic bullish view on precious metals, and regarded pullbacks as opportunities to build long positions for the medium and long term, though the market remained in the doldrums in the short term. On risks, attention should be paid to concerns that a worsening Middle East situation may stoke inflation and affect monetary policy, as well as liquidity-driven selling pressure amid recession fears. Given the high fluctuations in platinum and palladium, position control warrants attention. Due to the discontinuity between the domestic and overseas market, the opening prices of platinum and palladium often refer to the overseas night session, and investors should pay attention to trading prices in international markets and beware of gap openings.
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