Platinum likely to average $1,075 an ounce during 2017

UNITED STATES December 28 2016 3:15 PM

NEW YORK (Scrap Register): HSBC looks continued supply deficits to boost prices of platinum and palladium in 2017.

Platinum is forecast by the bank to average $1,075 an ounce next year, although this is down from HSBC’s prior forecast of $1,195 an ounce. The palladium forecast for next year was upped to $790 an ounce from $760 an ounce.

In 2018, HSBC sees platinum averaging $1,225 an ounce and palladium $850 an ounce. 

Platinum is expected to draw support from what HSBC described as a persistent but narrowing deficit and price-sensitive investor demand. The platinum supply deficit is seen at 150,000 ounces in 2017, compared to an expected 368,000 ounces in 2016.

Analysts suggested exchange-traded-fund and other investment demand is likely to rise on the discount in platinum prices to gold, while increases in auto and industrial demand should be supportive. However, they look for jewelry demand -- although likely to rise -- to remain sluggish.