UNITED KINGDOM May 31 2017 10:31 AM
LONDON (Scrap Register): Commerzbank analysts question whether palladium will be able to maintain upward momentum after the metal poked above $800 an ounce Monday, thus recovering by around $50 from the two-month low it hit at the beginning of last week.
“We do not believe that the high price is justified given that auto markets in the U.S. and China have been flagging recently – new data for the U.S. will be published on Thursday evening – and in view of the ETF [exchange-traded-fund] outflows seen in recent weeks,” Commerzbank added.
The high speculative interest entails risks of a more significant price correction. Palladium’s main industrial use is for catalytic converters in autos with gasoline-powered engines, which make up the bulk of the motor-vehicle markets in the U.S. and China.
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