In updating our medium-term platinum market forecasts, we highlighted that platinum’s underlying fundamentals were structurally resilient but challenged by negative sentiment linked to inflation and higher interest rate expectations. The unambiguously hawkish tone of new US Federal Reserve Chair, Kevin Warsh, adds downward pressure on the precious metals complex.Against this backdrop, we could see a reset lower in rate expectations if second-order inflationary impacts from energy costs are avoided with the signing of a MoU between the United States and Iran to end the war and reopen the Strait of Hormuz. A lower rates outlook could be the catalyst investors need to re-engage with platinum.Figure 7. Spot platinum prices have crossed below our estimated weighted avg. cost of platinum ETF holdings (in real* terms) which may disincentivise sellingSource: Bloomberg, WPIC Research, *Real: 2007
