SP Angel: Palladium Prices Remain Lofty On Strong Auto Demand
Palladium, underpinned by demand from the auto sector, has hit a fresh record high of $1,179.40 an ounce for spot metal. “Pollution-limiting catalytic converter demand in China is boosting palladium consumption, drawing prices 9% higher this year,” says commodities brokerage SP Angel. “The Asian nation is on a mission to reduce smog emissions, with tougher standards meaning car makers are using more of the commodity. Global palladium production is falling short of the robust demand….Hedge funds are also wagering on an extended rally, with the biggest long positive bet on the metal since early March.” Analysts note that almost 70% of demand comes from the auto industry, so strong car sales are helping to insulate prices from the “faltering” global growth hampering that is many industrial commodities. “While the metal is at threat of substitution from its sister metal platinum, manufacturers need 18-24 months for changes to take place, protecting near-term demand,” analysts add.
By Allen Sykora of Kitco News; firstname.lastname@example.org
BBH: Fed Fund Futures Trim Expectations For Rate Hikes
Monday November 19, 2018 09:09
The Federal funds futures are showing that traders in financial markets are scaling back expectations for Federal Reserve rate hikes next year, says Brown Brothers Harriman. “Implied yields on the December 2020 contract now suggest barely 50 bp [basis points] of tightening will be seen,” BBH says. “That includes a 25 bp hike in December, and so markets have basically taken back the second hike next year that had been fully priced in at the beginning of this month.”