Quick Take: Platinum, Palladium Take a Hit
NEW YORK ( TheStreet) -- Will Rhind, head of U.S. Operations at ETF Securities, discussed what has caused some of the recent moves in platinum and palladium with TheStreet's Joe Deaux on Wednesday.
According to Rhind, the metals are facing a large headwind from the impact of the U.S. dollar and the South African rand.
South Africa is the world's largest producer of platinum and second-largest producer of palladium, meaning that all of their income is priced in rands. However, when the metals go to the international markets, it's priced in dollars.
This results in the miners receiving more rand than they typically would because of the dollar strength, which is good for the business. But Rhind says this is taking a its toll on the price of the metal for investors at home, as it continues to head lower.However, he argued that the fundamentals should continue to shine for the metals, even if the current price does not. Demand is currently higher than the given supply and he expects this to last through at least 2013. While slowdowns in emerging markets remain a concern to many investors, especially in nations such as China, Russia and Brazil, Rhind says that platinum and palladium should be fine, pending any huge currency swoons or maco events. "At some point the fundamentals should speak for themselves," he added, "the demand situation right now is pretty attractive." -- Written by Bret Kenwell in Petoskey, Mich. Follow @traderboy23
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