The prices of most precious metals are set to fall over the next few years as rising real yields in the US weigh on investment demand. The one bright spot is palladium, where strategists at Capital Economics expect a combination of constrained supply and higher autocatalyst demand from tighter emissions standards to keep the price elevated this year and next.
Platinum will also follow the downward trend of most precious metals
“Investment demand for palladium is minimal, and we expect it to benefit more than platinum from a rebound in autocatalyst demand as it is used primarily in gasoline vehicles. Combining this with supply disruptions from two mines in Russia, we expect the deficit in the palladium to widen this year and help prices to reach $3,000 per ounce.”
“A decline in investment demand for platinum will compound the loss of demand from a shift away from diesel-fuelled vehicles, pushing the market back into surplus. We think the price will fall to $900 and $800 per ounce by end-2021 and end-2022, respectively.”