Platinum prices hit 6-year low
Platinum prices fell below $900 an ounce on Tuesday for the first time since January 2009.
LONDON - Platinum prices fell below $900 an ounce on Tuesday for the first time since January 2009, hurt by fears that the Volkswagen emissions scandal would cut demand from carmakers, but later pared losses as bargain-hunting investors swooped in.
The metal has been hit by last week's revelations that Volkswagen AG falsified US vehicle emission tests, which some believe could affect demand for diesel cars. Platinum is widely used in autocatalysts, particularly for diesel engines.
Spot platinum was down 0.2 percent at $914.50 an ounce by 2:35 pm EDT, having earlier touched a low of $894. The metal is on track for its biggest monthly loss since May 2012 in September, and its steepest quarterly plunge in seven years.
"There might be some discussions going on, despite the worry about diesel vehicle demand, if the fundamentals really justify the market being around $900," James Steel, chief metals analyst for HSBC Securities in New York, said of the recovery from the lows.
"The dips have been met a little bit with some short-term buying."
Even before the Volkswagen scandal broke last week, the market had been suffering from an increase in supplies following the end of last year's five-month strike among platinum miners in major producer South Africa, and a weakness in Chinese jewelery demand.
Spot gold was down 0.3 percent at $1,127.80 an ounce, while US gold futures for December delivery settled down $4.90 an ounce at $1,126.80.
Gold has come under pressure from uncertainty over when exactly the Federal Reserve will raise US interest rates for the first time in nearly a decade. Conflicting views by policymakers, several of whom are scheduled to speak this week, have stirred more uncertainty.
William Dudley, head of the New York Fed, and John Williams, head of the San Francisco Fed, both signalled support for a rate hike this year. But Charles Evans, head of the Chicago Fed, called for rates to stay near zero until mid-2016.
"Fed policy has been instrumental in influencing gold prices for many months," HSBC said in a note. "The bullion market consequently continues to look for any indicators of Fed policy shifts."
Gold spent much of the day trading just below unchanged, but extended losses slightly after equities turned higher in the afternoon.
Silver was up 0.5 percent at $14.63 an ounce, while palladium was up 1.7 percent at $654.75 an ounce.