Palladian Wings

Palladian Wings

over 4 years ago2 mins

Back in December, we noted that gold had been knocked off its traditional top spot as the most valuable precious metal. The commodity that took its place? Palladium. And while the price of gold rose 9% in June, palladium did even better...

Palladium’s price has risen almost 30% this year (Source: JE Gross)
Palladium’s price has risen almost 30% this year (Source: JE Gross)

Palladian?

Nope – nothing to do with the classically inspired architectural tradition (good knowledge, though, Finimizer 👌). Palladium is a rare metal: mainly used in gasoline vehicles’ catalytic converters.

Article Image

These turn toxic exhaust fumes into less harmful emissions. And as European drivers desert more polluting diesel vehicles and Chinese automakers prepare for their own tougher emissions regime, demand for palladium has shot up despite slowing global auto sales. A weakening US dollar has also made the dollar-priced metal cheaper overseas 🙃

As demand has grown, palladium’s price has also risen. In December, it outstripped gold’s for the first time in over 16 years – and has stayed there ever since:

Article Image

But is it a flash in the pan?

You do know your art history: palladium’s use in photography was once widespread. But what with the ubiquitous Facestagram, it’s unlikely many people are using the pricey metal to take snaps nowadays 📸

Automaker demand, however, is forecast to grow by a third by 2025. And a lack of mining investment is constraining supply in the short term: US mines produced 7% less palladium in 2018 than they did the year before, and future Russian supplies are uncertain.

Article Image

The relatively small size of the palladium market makes its price particularly volatile, and gold remains the safe haven of choice for stock market-spooked investors. But those with real art history chops will recall the other meaning of “palladium”: a talismanic image that protects its owner... 🤞

Whichever lucky charm you favor, the duel for the crown of “most precious precious metal” looks set to continue for some time to come.

Article Image

Would you like to see more stories like this? Tell us

Finimize

BECOME A SMARTER INVESTOR

All the daily investing news and insights you need in one subscription.

Disclaimer: These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment advisor.

/3 Your free quarterly content is about to expire. Uncover the biggest trends and opportunities. Subscribe now for 50%. Cancel anytime.

Finimize
© Finimize Ltd. 2023. 10328011. 280 Bishopsgate, London, EC2M 4AG