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Palladium Stays on Record-Breaking Trail as Gold Sniffs at China Deal

Investing.com – Palladium, the auto-catalyst metal in short supply, stayed on its record-breaking spree on Thursday as its shinier cousin gold edged higher by remaining doggedly on the trail of the U.S.-China negotiations.

The spot price of palladium was up $2.70, or 0.1%, at $1,824.70 after a record high at $1,877.98.

Palladium futures for March delivery on Comex settled up just 30 cents at 1,845.70 after peaking at an all-time high of $1,848.35.

The metal has been breaking records almost daily since last Monday.

“Palladium demand for autocatalysts should keep rising,” Giovanni Staunovo, a commodity analyst at UBS Wealth Management, said in a note to clients. “Despite platinum’s widening discount to palladium, we don’t anticipate any meaningful substitution of palladium in the car sector.”

Palladium serves as a catalyst and purifier of emissions for gasoline engines. Platinum serves similar functions for diesel-powered cars. While the popular theory is that platinum can substitute for palladium, auto industry experts say such substitutions would ultimately result in higher costs for carmakers. Platinum trades at least $900 an ounce less than palladium.

Gold prices rose in the absence of strongly positive news on the trade talks, although U.S. Treasury Secretary Steven Mnuchin told reporters that negotiations between Washington and Beijing were progressing, without a deadline for conclusion.

Gold futures for February delivery on New York’s COMEX settled up $2.90, or 0.2%, at $1,483.10 per ounce. It hit a four-week high of $1,487.65 on Tuesday as investors rushed to look for a hedge as markets tanked on Trump’s indication of a 2021 timeline for a China deal.

Spot gold, which tracks live trades in bullion, was up $1.76, or 0.1%, at $1,475.86 by 3:30 PM ET (20:30 GMT). It reached a four-week peak of $1,481.90 on Tuesday.

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