[Platinum and Palladium Price Review and Forecast]
This week (September 11-September 17), platinum and palladium prices opened lower with a gap, consolidated at lows, and moved sideways after the rate hike landed, with both metals closing lower for the week.
At the start of the week (Friday, September 11), overnight US August CPI rose 3.4% YoY, in line with expectations, but core CPI rose 0.3% MoM, above expectations and the largest monthly gain since April. Combined with gasoline prices surging 3.9% MoM, sticky inflation re-emerged, and market pricing for a September Fed rate hike quickly rose to 85%-90%. A stronger US dollar and Treasury yields weighed on precious metals valuations. Hit by the data, platinum and palladium opened lower with a gap, with palladium touching an intraday low of 300.4 yuan/g (the weekly low), approaching the 300-yuan round number.
Mid-week, market sentiment recovered somewhat, and the market entered a wait-and-see window ahead of the FOMC meeting, with platinum and palladium moving sideways and market tug-of-war intensifying.
On Thursday (September 17) early morning, the Fed announced a 25bp rate hike as expected, raising the federal funds target range to 3.75%-4.00%, the first hike since July 2023. The FOMC approved the decision unanimously with 12 votes in favor and 0 against. The latest dot plot showed one more hike may be possible before the end of 2026. Warsh stressed at the press conference that inflation remains high and the Fed is focused on price stability. However, as the market had already largely priced in this hike, the reaction was relatively muted after the hike landed, and platinum and palladium fluctuated narrowly during the day.
The most-traded GFEX platinum contract (PT2610) hit a weekly high of 441.4 yuan/g and a low of 428.1 yuan/g, closing at 435.75 yuan/g on September 17, with a weekly range of about 3.11%. The most-traded palladium contract (PD2610) hit a weekly high of 308.85 yuan/g and a low of 300.4 yuan/g, closing at 305.05 yuan/g on September 17, with a weekly range of about 2.81%.
In the spot market, after futures opened sharply lower at the start of the week, spot discounts for platinum and palladium narrowed significantly. Most downstream orders recovered, with buyers actively inquiring and purchasing near short-term price lows following the futures market. Deep-discount spot cargoes were cleared, and suppliers held prices firm while selling. During the week, mainstream platinum quotations were concentrated at GFEX PT2610 discount of 1 yuan/g to parity, while mainstream palladium quotations were concentrated at GFEX PD2610 discount of 0.5 yuan/g to premium of 0.5 yuan/g. By the end of the week, most transactions were concluded near parity with the October contract. Spot supply was tight, and some traders took delivery of platinum and palladium warrants due to lower funding costs.
Looking ahead, the Fed restarted rate hikes after more than three years, and the dot plot suggested one more hike may be possible within the year. Rate-side pressure is unlikely to fade in the short term, limiting upside room for platinum and palladium. On the bullish side, COMEX registered platinum inventory is at historically extremely low percentiles, and supply constraints at the mine side provide support for platinum's bottom. For palladium, Russian supply risks remain, and if geopolitical conflicts escalate again, periodic supply premiums may be triggered. On the bearish side, the Fed's rate hike cycle has restarted, US Treasury yields stay high, and the opportunity cost of holding precious metals has risen. Warsh's hawkish tone is clear, and if subsequent inflation data rebounds again, expectations for a December hike may further intensify. Going forward, focus should be on Fed officials' speeches, US September inflation and employment data, and the policy path. In the short term, platinum and palladium may continue to consolidate on a subdued note.
[Platinum and Palladium Weekly Data Commentary]
COMEX platinum and palladium inventories maintained a divergent pattern this week. Platinum inventory continued its previous destocking trend, with registered inventory at around 190,000 oz as of mid-September, at an extremely low level in the 10th percentile historically. Deliverable buffer is thin, and the tight supply-side pattern remains unchanged. Total inventory was around 390,000 oz, with the registered share at about 48%-49%. Palladium inventory continued to consolidate at highs, with registered inventory at about 198,000 oz and total inventory at about 250,000 oz. The registered share was nearly 80%, and US warehouse buffer inventory remained near one-year highs, with the ample supply pattern unchanged.
On imports, according to customs data, July 2026 unwrought platinum and platinum powder imports were about 8.35 mt, down 21.74% MoM and up 23.52% YoY. Unwrought palladium and palladium powder imports were about 2.99 mt, down 37.05% MoM and down 2.61% YoY. Although platinum imports pulled back MoM, they still maintained YoY growth. January-July cumulative imports were about 56.53 mt, up about 16.5% YoY, with the import level significantly higher than the same period in 2023-2025. Palladium imports turned negative YoY in July, the first monthly YoY decline since 2026, but January-July cumulative imports were about 29.96 mt, still up about 85% YoY. Overall, domestic platinum and palladium supply remains relatively ample, and combined with export restriction policies, domestic surplus is difficult to digest through exports.
On lease rates, London platinum and palladium lease rates remained at low levels. The one-month platinum lease rate was below 2%, and the one-month palladium lease rate hovered near 1%, indicating ample spot market liquidity and weak borrowing demand, with the overall ample supply pattern unchanged.
[Platinum Group Compounds]
Chloroplatinic acid was quoted at 176.5 yuan/g on Friday, edging up 1 yuan/g from 175.5 yuan/g the previous Friday, a gain of 0.6%. Palladium chloride was quoted at 194 yuan/g on Friday, rebounding 4.5 yuan/g from 189.5 yuan/g the previous Friday, a gain of 2.4%. By weekly average price, chloroplatinic acid averaged about 176.6 yuan/g this week and palladium chloride about 193.8 yuan/g, still below last week's averages of 180.2 yuan/g and 199.3 yuan/g, overall in a pattern of stabilizing at lows and moving sideways.
This week, affected by a slight pullback in raw material prices, compound prices stabilized at lows, and downstream buying sentiment improved. As domestic auto industry total volume is expected to recover MoM in September-October, internal combustion engine vehicles are expected to edge up MoM. Driven by rising oil prices, internal combustion engine vehicle production and sales will remain under pressure going forward, and auto demand upside is blocked. Relative to the domestic off-season recovery, overseas auto exports may become the most critical marginal growth driver. Overall, compared with the previous two weeks, compound spot shipment pace accelerated this week.
