Palladium Market Update (November 15, 2012)

Palladium started October at about $630. The market benefited from strong auto data and supply concerns connected to the South African labor situation. Prices hit a monthly high of $669 on October 5.

However, the market grew increasingly risk averse as the month progressed. Macroeconomic concerns began to play a more dominant role in investors’ sentiment and prices began to decline around mid-October, sliding back down to $635 on October 15. There was a bounce on positive economic data from China on October 18, but the upward move did not hold up and prices quickly began sliding again.

Toward the end of October, palladium prices fell back in the direction of levels last seen in August. The metal was down to $595 on October 30.

Palladium managed to stay above the $600 level in the early days of November. That occurred despite pressure from speculative selling that emerged during the first full trading week of the month. However, on November 13, the market, which was at $609, got a real boost after Johnson Matthey issued as report forecasting a palladium supply deficit in 2012. By November 14, palladium prices had risen to $650.