Palladium price continues to rise – Commerzbank
|The price of Palladium continued its upward trend that began on Thursday at the start of the new trading week. It reached its highest level in more than 10 months today at $1,240 per troy ounce, Commerzbank’s commodity analyst Carsten Fritsch notes.
Extent of the current price rise seems excessive
“This means that the price of Palladium has risen by more than 15% in just over three trading days. On Friday, we reported on the trigger for the price jump, namely the US government's call to the G7 to consider further ways to reduce Russian revenues in the metals sector, including restrictions on Palladium exports. The price increase was likely to have been exacerbated by the covering of speculative short positions.”
“According to the CFTC, net short positions on 22 October were still around 5,500 contracts. However, positions had already been scaled back in the preceding weeks. By comparison, the record level for net short positions was reached at the beginning of August at 16,300 contracts. It seems that the speculative investors have become less pessimistic in their price expectations for Palladium.”
“There are further arguments for this, in addition to the feared restriction of Russian Palladium supplies. The low price levels of Platinum and Palladium are likely to lead to production curtailments in South Africa. Fears that the transition to e-mobility could mean that hardly any Palladium will be needed in car production just a few years from now have proved to be exaggerated. Nevertheless, the extent of the current price rise seems excessive to us.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.