Out the major precious metal commodities, palladium is usually thought of as the least popular or least well known. But if recent pricing trends are any indication, those perceptions are certainly changing. Palladium prices surged more than 50% in Q4 last year, making it among the best-performing commodities of 2018. It did so well, that the market closed with palladium prices higher than gold 8 times in December alone.
While not unprecedented, it’s still pretty unusual for palladium prices to outperform gold. There are several factors that could be influencing this trend. For instance, more than 80% of the world’s palladium is used in catalytic converters to help vehicles reduce their output of pollutants. Antipollution legislation gained traction in several countries around the world last year, which likely had an indirect impact on palladium demand via the automobile industry. Similarly, mining companies dealing with labor disputes or global trade (re)negotiations may be affecting the global supply of palladium in a way that doesn’t keep pace with the growing demand – affecting prices even further.
It’s anyone’s guess as to how long this trend will last. To stay in the loop, try our precious metals price tracking app.