Dec. 26 (Bloomberg) -- Platinum futures jumped the most in 10 weeks on speculation that a global economic rebound will boost demand for the metal used for pollution-control devices in cars. Gold also rose.
Platinum jumped as much as 3.8% to a two-week high at 8:20 a.m. New York time in the most-active trading of the session. The price will rally to $1,650 an ounce in 2014 as consumption surpasses output, a Bloomberg survey showed. Demand exceeded supply this year by the most since 1999, according to Johnson Matthey Plc.
“There’s a deficit in platinum, and people probably have just realized how cheap it is,” Dominic Schnider, the head of commodity research at UBS AG’s wealth-management unit in Singapore, said in a telephone interview. “Unlike gold, platinum benefits from a global economic recovery.”
Platinum futures for April delivery climbed 2 percent to settle at $1,363.80 an ounce at 1:24 p.m. on the New York Mercantile Exchange, the biggest gain for a most-active contract since Oct. 17.
On the Comex in New York, gold futures for February delivery rose 0.7 percent to $1,212.30 an ounce. Earlier, the price reached $1,215.40, the highest since Dec. 19.
The global economy is set to expand 2.8 percent next year from almost 2 percent in 2013, according to forecasts compiled by Bloomberg. Platinum’s shortfall will increase 78 percent to 605,000 ounces this year and will probably widen into 2014, according to London-based Johnson Matthey, which makes one-third of the world’s catalytic converters.
Holdings of exchange-traded products backed by platinum rose to a record 77.98 metric tons on Dec. 20. Assets in gold ETPs have tumbled to the lowest since November 2009.
Platinum has dropped 12 percent this year, and gold has tumbled 28 percent, heading for the biggest drop since 1981.
Silver futures advanced 2.2 percent to $19.916 an ounce on the Comex, the biggest increase since Dec. 16. Palladium futures for March delivery advanced 0.8 percent to $700.75 an ounce on the Nymex, the largest gain since Dec. 5.
--With assistance from Debarati Roy in New York. Editors: Patrick McKiernan, Thomas Galatola