IGI Logo

Platinum extended its gains into a fifth straight session on Thursday, holding near more than a six-year high, with analysts expecting further upside driven by higher demand from the automobile sector as an economic recovery picks up pace.

Platinum was up 1.4% to $1,258.33 per ounce by 11 a.m EST (1600 GMT), having earlier jumped as much as 2.2% to its highest level since January 2015 at $1,268.88.

Palladium was flat at $2,355.93 per ounce.

Platinum's rally was driven by a relatively tight market "and certainly the investment demand, which is reflected in strong exchange traded fund (ETF) inflows among others," said Commerzbank analyst Daniel Briesemann.

Both platinum and palladium are used by automakers in catalytic converters to clean car exhaust fumes.

"Short-term supplies are probably just not going to be able to hold up, while demand is going to be extremely high," said Edward Moya, senior market analyst at OANDA.

Platinum may see a third consecutive annual deficit in 2021, specialist materials firm Johnson Matthey said in a report released on Wednesday.

"The market has been looking beyond the pandemic - to a recovery in the auto sector, which will eventually happen," said StoneX analyst Rhona O'Connell.

It will draw support from potential demand for fuel cells, with the Johnson Matthey report also talking about increased loadings, particularly for diesel vehicles, O'Connell said.

Citi Research analysts expect prices to rise to $1,300 an ounce by the end of the year.

Elsewhere, spot gold edged 0.2% lower to $1,838.44 per ounce. U.S. gold futures fell 0.1% to $1,840.30.

Spot silver rose 0.6% to $27.15.

"Gold is still being kept in check by the positive market sentiment in general ... Gold does not seem to be in particular demand right now," Commerzbank's Briesemann said.

Wall Street's main indexes opened near record highs.

(Reporting by Eileen Soreng, Asha Sistla; Additional reporting by Nakul Iyer in Bengaluru; Editing by Paul Simao)