Precious: Palladium rallies, gold rises above $1,900 with focus on Russia

Platinum Metals

23/02/2022 15:20

(Adds analyst comments, details, and updates prices)
    * Dollar dips, caps gold's losses
    * U.S. 10-year Treasury yields firm
    * Palladium trades near previous session's two-week high

    By Seher Dareen
    Feb 23 (Reuters) - Palladium rose over 3.2% on Wednesday,
adding to gains in the autocatalysts driven by fears of a hit to
supply from top producer Russia, while gold rose above the key
$1,900 level with focus on developments in the Ukraine crisis.
   Russia is the world's third largest producer of gold, while
the country's Nornickel  GMKN.MM  is also a major producer of
palladium and platinum, which are both used in catalytic
converters to clean car exhaust fumes.  urn:newsml:reuters.com:*:nL8N2UP4TC
   Russia produced 2.6 million troy ounces of palladium last
year, or 40% of global mine production, and 641,000 ounces of
platinum, or about 10% of total mine production.
   While it was "still too early" to tell if supply issues would
materialise, "if we see a set of sanctions that reduce financing
and free flow of the material to the rest of the world, we could
see a significant tightening of conditions for palladium
probably in the not too distant future," said Bart Melek, head
of commodity strategies at TD Securities.
    Platinum group metals could see a "pretty significant rally"
with palladium likely to reach record highs seen last year over
$3,000 an ounce, Melek added.
    Silver  XAG=  rose 0.6% to $24.23 per ounce and platinum
 XPT=  advanced 1.1% to $1,087.83.    
    Spot gold  XAU=  rose 1.06% to $24.34 per ounce by 1459 GMT,
having hit a near nine-month high of $1,913.89 on Tuesday. U.S.
gold futures  GCv1  fell 0.1% to $1,904.60.
    The U.S. and its allies unveiled more sanctions against
Russia on Wednesday over its recognition of two separatist areas
in eastern Ukraine.  urn:newsml:reuters.com:*:nL1N2UY0FZ urn:newsml:reuters.com:*:nL1N2UX1P0  urn:newsml:reuters.com:*:nL1N2UY0FZ
 urn:newsml:reuters.com:*:nL1N2UX0AD
    "Should fears over geopolitical tensions subside, that would
leave the Fed’s policy tightening path as bullion's primary
driver, with further climbs in real Treasury yields likely to
unwind the geopolitical risk premiums currently baked into gold
prices," Han Tan, chief market analyst at Exinity
said. urn:newsml:reuters.com:*:nL1N2UT22F  urn:newsml:reuters.com:*:nL1N2UT1TV     

 (Reporting by Seher Dareen and Bharat Govind Gautam in
Bengaluru, Editing by Krishna Chandra Eluri)
 ((Seher.Dareen@thomsonreuters.com ; If within U.S. call
651-848-5832))