Market Nuggets: UBS: Platinum/Palladium Ratio Recovering From 11-Year Low
Thursday August 22, 2013 8:32 AM
Platinum has regained some ground on palladium lately and speculative positioning for platinum looks "healthier," says UBS. Both metals have largely taken a "back seat" to gold and silver in recent weeks, with little fresh news to drive platinum group metals. The platinum/palladium ratio fell to an 11-year low of 1.90 in mid-July. "The ratio has recovered since and currently sits around 2.02, reflecting platinum regaining some ground versus palladium," the bank says. Speculative positioning has increased in both over the last six weeks. "Platinum specs were more aggressive over this period, bumping up net long positions by 58% from early-July levels, while palladium counterparts added 38% to net positioning," UBS says. "The platinum data likely reflects it trying to catch up, helped by positive sentiment on the back of the strong response to the new ETF launched in South Africa. Also, despite the relatively faster extension in platinum spec length of late, current positioning still looks healthier than in palladium, with net platinum longs at 62% of the all-time high versus 90% for palladium." Swiss trade data shows volumes in July were light for both metals, UBS says. Swiss imports of palladium from Russia, which are watched especially closely by the market due to expectations that Russian state stockpiles are nearly depleted, were limited at 0.2 metric ton.
