THE improvement in the price of platinum may relate to concerns of a potential flight ban out of South Africa following an increase in Covid-19 infections, said Bloomberg News.
StoneX analyst Rhona O’Connell said in a note that platinum surged “possibly on fears of potential disruption to logistics on any flight ban out of South Africa,” the world’s largest producer of the metal.
South African authorities detected a variant of Covid-19 which makes it more transmissible. It may also be resistant to infections, according to some scientists.
Palladium also touched a 10-month intraday high on Tuesday.
“We see rising PGM (platinum group metal) prices to be positive for Anglo American given that PGMs account for 23% of FY20 EBITDA on our estimates,” said Goldman Sachs.
Meanwhile, gold continued to advance, rising to an eight-week high as the dollar weakened with traders awaiting results from key elections in Georgia and weighing surging coronavirus cases, said Bloomberg News.
“Gold has remained robust in the face of the continued onslaught of the virus and its variants while the dollar remains under pressure,” said O’Connell.
“The reflation element combined with a weaker dollar and lower real yields all point to further short-term gains” for gold, Ole Hansen, head of commodities strategy at Saxo Bank A/S, wrote in a note.
On Monday, holdings in SPDR Gold Shares, the largest bullion-backed exchange-traded fund, posted the biggest daily inflow since September following withdrawals in the last three months of 2020, said Bloomberg News.