Platinum price steadies after 4-day rout, demand worries remain
London (Sept 24) Platinum edged up on Thursday after a four-day rout prompted by fears about demand from the auto sector following the Volkswagen diesel emissions scandal.
Palladium, predominantly used in gasoline catalysts, retreated from an earlier mid-July high, down 0.5 percent at $642 an ounce.
Volkswagen AG, the world's biggest carmaker by sales, admitted to U.S. regulators that it programmed its cars to detect when they were being tested and alter the running of their diesel engines to conceal their true emissions.
Platinum is used in diesel catalysts to clean up exhaust emissions.
"The market is obviously pre-empting a possible disruption to the whole diesel catalytic converter sector and we now need to see what the future holds for diesel demand in the U.S. and the reverberations in Europe," Saxo Bank senior manager Ole Hansen said.
Spot platinum was up 1 percent at $939.20 an ounce by 1009 GMT, after losing about 5 percent in the past four sessions. The metal remained within sight of a 6-1/2 year low of $924.50 hit on Wednesday.
Platinum also had some support on Thursday from Japanese traders returning from a three-day holiday.
"The Japanese came in aggressively on the bid this morning, taking the white metal more than $20 higher," said MKS Group trader Jason Cerisola.
Spot palladium logged a near 7 percent jump in the previous session.
"Talks about the potential switch from diesel to gasoline propped up palladium yesterday," Hansen said.
Gold also climbed for a second straight session, gaining 0.4 percent to $1,134.56, as the dollar and European shares eased.
Worries that an eventual tightening in U.S. monetary policy and slower growth in China could knock the global economy have scared investors, prompting some safe-haven bids for gold.
Holdings in SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, rose for a second straight session, providing some support for prices. The fund added 0.60 tonnes on Wednesday, bringing total holdings to 676.40 tonnes.
Investors will be closely monitoring a speech by Federal Reserve Chair Janet Yellen later in the session for clues on when the U.S. central bank will begin to raise rates.
Silver rose 0.3 percent to $14.78 an ounce.