Precious Metals Weekly
Group Economics Macro & Financial Markets Research
Range frustration
Georgette Boele, tel,+31 20 6297789
10 June 2015 • •
Lack of direction in precious metal prices… …while the investor sentiment towards palladium has deteriorated
Break of the range?... Not yet…
the eurozone (more than 40% of annual auto catalyst demand)
Investors are disappointed and even in a way frustrated about
and the euro. Since mid-March, sentiment has recovered,
the lack of direction in precious metal prices. About one month
helped by stronger-than-expected eurozone data. In general
ago, there were some prospects that gold prices would higher.
stronger Chinese jewellery demand and better demand
Prices reached USD 1,230 per ounce but they lost momentum
prospects from the eurozone have helped platinum relative to
again. Last week, the much better-than-expected US
palladium.
employment report resulted in a strong rally in the US dollar and in weakness in precious metal prices. Platinum prices
Palladium autocatalyst demand
made a new low, but did not close below the previous low that
Metric tonnes
was set in March. Since then, prices have recovered. Similar price actions can be seen in silver and palladium. The range in silver prices is converging. Meanwhile, investor sentiment for palladium is deteriorating, but prices have not approached the low set in March of this year around USD 730 per ounce. However, when we look further down the road a stronger US dollar and higher US rates in the coming weeks and months should push precious metal prices lower. In short, we expect,
7000 6000 5000 4000 3000 2000 1000 0
ranges in precious metal prices to be broken on the downside.
99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 EU
Palladium is in a weak spot This deterioration in investor sentiment towards palladium has
China
North America
Japan
Rest of the world
Source: Thomson Reuters Datastream GFMS
been driven by the recent weaker-than-expected economic data out of China. Palladium prices are very sensitive to the emerging markets and especially China. Autocatalyst demand
ABN AMRO forecasts End period Gold Silver Platinum Palladium
10-Jun Close 14 Mar-15 Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 1,190 1,185 1,184 1,100 1,050 1,000 950 900 850 800 15.7 16.6 16.1 15.0 15.5 16.0 16.5 17.0 17.5 18.0 1,118 1,216 1,141 1,100 1,150 1,200 1,250 1,300 1,350 1,400 798 736 747 650 675 700 700 725 750 750
In the case of gold, silver and platinum, China is also a very
Average Gold Silver Platinum Palladium
Q1 15 1,218 16.7 1,194 786
crucial market especially from the jewellery demand side. In
Source: ABN AMRO Group Economics
accounts for around 70% of total palladium demand. Of this demand, 23% comes from China (see graph). Recent Chinese economic data show weakness on the industrial side and the car production has slowed since March (despite the overall trend still being positive).
2014, it accounted for more than 60% of platinum jewellery demand, 30% of gold jewellery demand and 25% of silver jewellery demand. Since Q2 2014, Chinese gold jewellery fabrication has increased. This indicates that despite China losing some momentum, jewellery fabrication is not much affected at the moment. Therefore, silver and gold prices have outperformed palladium prices this year. At the start of this year, platinum prices underperformed all precious metals because negative investor sentiment towards
Q2 15 1,142 15.8 1,120 693
Q3 15 1,075 15.3 1,125 663
Q4 15 1,025 15.8 1,175 688
2015 Q1 16 Q2 16 Q3 16 Q4 16 1,115 975 925 875 825 15.9 16.3 16.8 17.3 17.8 1,154 1,225 1,275 1,325 1,375 707 700 713 738 750
2016 900 17.0 1,300 725
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Precious Metals Weekly - Range frustration
Precious metals Gold prices per troy ounces Gold price in USD Gold price in EUR Gold price in JPY Gold price in CHF Gold price in GBP Gold price in INR Gold price in CNY Gold price in BRL Gold price in RUB Gold price in TRY Silver prices per troy ounces Silver price in USD Silver price in EUR Platinum prices per troy ounces Platinum price in USD Platinum price in EUR Platinum price in JPY Platinum price in CNY Palladium prices per troy ounces Palladium price in USD Palladium price in EUR Palladium price in JPY Palladium price in CNY Palladium price in BRL Palladium price in INR Palladium price in RUB Gold forw ard rates LBMA 1 Month Gold Forw ard Offer rate BBA LIBOR USD 1 Month Gold 1 Month Lease rate LBMA 3 Month Gold Forw ard Offer rate BBA LIBOR USD 3 Month Gold 3 Month Lease rate Volatility 1 month gold option volatility 1 month silver option volatility 1 month platinum option volatility 1 month palladium option volatility COMEX & NYMEX positions NET LONGS - GOLD (COMEX) NET LONG ON SILVER (COMEX) NET LONG ON PLATINUM (NYMEX) NET LONG ON PALLADIUM (NYMEX) Total ETF positions Total Know n ETF Holdings of Gold Total Know n ETF Holdings of Silver Total Know n ETF Holdings of Platinum Total Know n ETF Holdings of Palladium Relative Gold/Silver ratio Gold/Platinum ratio Platinum/Palladium ratio Source: Bloomberg
Close
Change 1 Day in %
Change 5 days in %
Change YTD in %
1,190 1,050 146,175 1,103 767 75,901 7,382 3,657 64,621 3,257 Last 16 14 Last 1,118 987 137,370 6,937 Last 747 659 91,785 4,635 2,296 47,641 40,552 Last 0.07 0.19 0.12 0.10 0.28 0.19 Last 12.48 24.14 16.54 18.00 Last 108,150 57,569 26,573 16,655 Last 51,080,644 621,694,787 2,666,306 2,957,910 Last 73.70 1.06 1.50
1.09 0.53 -0.11 0.60 0.11 0.74 1.07 0.22 -1.37 0.49 Change 1 Day in % 0.79 0.37 Change 1 Day in % 0.93 0.41 -0.21 0.95 Change 1 Day in % 0.80 0.33 -0.26 0.88 0.04 0.53 -1.56 Change 1 Day in % -27.78 1.31
0.39 -0.05 -0.64 -0.23 -0.63 0.10 0.71 -0.99 0.72 2.64 Change 5 days in % -2.17 -2.71 Change 5 days in % 1.29 0.61 0.02 1.56 Change 5 days in % -1.56 -2.18 -2.72 -1.27 -3.05 -2.04 -1.45 Change 5 days in % -13.33 1.31
0.40 6.96 2.67 -6.60 0.54 1.09 0.05 16.28 -2.57 17.27 Change YTD in % 2.75 9.81 Change YTD in % -8.05 -1.68 -5.64 -8.04 Change YTD in % -6.44 -0.20 -4.28 -7.16 8.26 -5.75 -12.93 Change YTD in % 252.94 8.26
-13.64 0.36
5.56 -0.11
0.00 10.41
Change 1 Day in % -2.27 -1.59 0.06 0.00 Change net 5 days -1,570 -3,933 -4,956 -1,156 Change net 5 days -170,316 6,439,875 3,083 -5,767 Change 1 Day in % 0.17 0.12 0.07
Change 5 days in % -5.33 1.36 -4.52 -1.97 Change net 1 Month 33,988 20,319 -879 -2,275 Change net 1 Month -847,086 830,631 3,292 20,175 Change 5 days in % 2.72 -0.69 2.88
Change YTD in % -27.73 -18.67 1.19 -16.78 Change net YTD 2,925 23,837 -3,377 -5,363 Change net YTD -308,596 -1,416,061 -57,588 -108,980 Change YTD in % -2.58 8.87 -1.57
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Precious Metals Weekly - Range frustration
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