- Zimbabwe asks miners to curtail power use during drought
- Platinum rebounds from six-year low reached last week
Platinum futures climbed to the highest in almost two weeks as Zimbabwe asked mining companies to reduce power usage, damping the supply outlook for the metal.
Zimbabwe, the world’s third-largest producer of the mined metal, asked Impala Platinum Holdings Ltd., Anglo American Platinum Ltd. and other companies to reduce electricity consumption by 25 percent amid a water shortage that’s cut hydropower supply.
Platinum dropped to a six-year low last week as ebbing economic growth in China and prospects for lower sales of diesel cars spurred demand concerns for the metal, used in auto pollution-control devices. Prices on Wednesday capped a fourth straight gain, helped by expectations that the Federal Reserve will delay tightening U.S. monetary policy.
“Zimbabwe urged big mines to cut power use by 25 percent, and they are behind South Africa and Russia as the next biggest producer of platinum,” James Steel, an analyst at HSBC Securities (USA) Inc. in New York, said in a telephone interview. “That might have lent some support.”
Platinum futures for January delivery climbed 1.3 percent to settle at $946.40 an ounce at 1:30 p.m. on the New York Mercantile Exchange, after touching $955.50, the highest since Sept. 24.
Expectations of a Fed interest-rate increase this year have been scaled back from 43 percent on Oct. 1 to 39 percent on Wednesday on signs that U.S. growth may be slowing. The odds rise to 61 percent for a move in March, according to Fed-fund futures data compiled by Bloomberg. Higher rates would crimp demand for precious metals because they don’t pay interest, unlike competing assets.
Gold futures for December delivery gained 0.2 percent to $1,148.70 an ounce on the Comex in New York. Silver futures also advanced on the Comex, while palladium fell on the Nymex.
(An earlier version of the story corrected the exchange where platinum trades.)