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Platinum Has Longest Rally in 25 Years; Gold Gains on QE3

Sept. 14 (Bloomberg) -- Platinum rose, capping the longest rally in 25 years, after the Federal Reserve took steps to bolster the U.S. economy and as strikes halted output at mines in South Africa, the world’s largest producer. Gold advanced.

The Fed yesterday said it will expand its holdings of long-term securities with open-ended purchases of $40 billion of mortgage debt a month in a third round of quantitative easing. Workers at a Lonmin Plc mine and nearby operations of Anglo American Platinum Ltd., the biggest producer, are holding protests over pay.

“Today’s rally can be attributed partly to the easing announced yesterday,” Marc Ground, a commodity strategist at Standard Bank Plc in Johannesburg, said in a telephone interview. “The fundamentals remain supportive.”

Platinum for immediate delivery rose 1.5 percent to $1,709.65 an ounce at 3:10 p.m. New York time. The price climbed for the 11th straight session, the longest rally since at least January 1987. Earlier, the metal reached $1,715.70, the highest since Feb. 29.

The spot price has jumped 22 percent since Aug. 10, when violence that left 45 people dead started at Lonmin’s Marikana operation.

On the New York Mercantile Exchange, platinum futures for October delivery gained 2 percent to settle at $1,713.70. Palladium futures for December delivery rose 1.5 percent to $699.30 an ounce. The metal climbed for the 10th straight session, the longest rally since June 2000.

Gold Rally

Gold futures for delivery in December rose 60 cents to $1,772.70 an ounce on the Comex in New York. Earlier, the price reached $1,780.20, the highest since Feb. 29.

“With the prospect of further liquidity flowing into the market, gold will likely maintain its upward momentum,” James Moore, an analyst at Basemetals.com in London, said in an e-mail.

Yesterday, holdings in exchange-traded products backed by gold rose to a record for the eighth straight session, reaching 2,492.95 metric tons, data tracked by Bloomberg showed.

Silver futures for December delivery fell 0.4 percent to $34.656 an ounce on the Comex.

To contact the reporters on this story: Maria Kolesnikova in London at mkolesnikova@bloomberg.net; Debarati Roy in New York at droy5@bloomberg.net

To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net

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