Palladium poised for best week in 2 months; Gold price headed for a flat week

May 23 2014, 10:38 IST
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SummaryPalladium was steady near a 2-1/2-year high on Friday and was headed for its best week in two months on supply fears due to a prolonged strike in major producer South Africa.

Palladium was steady near a 2-1/2-year high on Friday and was headed for its best week in two months on supply fears due to a prolonged strike in major producer South Africa.

Platinum was on track for its second straight weekly gain, also on supply worries, while gold was headed for a flat week.

Palladium was steady in early Asian trading after hitting $837.40 an ounce in the previous session - its highest since August 2011. The metal has gained 2.3 percent this week, while platinum has climbed nearly 2 percent.

"The platinum group metals will see some more gains as it doesn't look like there will be an agreement soon on the wages in South Africa," said one precious metals trader in Hong Kong. "With violence also increasing, we can see gains at least in the short term."

The crippling four-month miners' strike in South Africa could last much longer, the chief executive of Impala Platinum said, adding that feedback from initial court-mediated talks with the world's biggest producers and main mining union was lukewarm.

The strike is the longest and costliest industrial action in the mining history of South Africa, the biggest producer of platinum and the second biggest producer of palladium.

It has grown increasingly violent as growing numbers of workers have attempted to return to work though the unions are pressing for more strikes.

A member of South Africa's National Union of Mineworkers was stabbed to death on his way to work at an Anglo American Platinum mine, the union said on Thursday, the fifth such killing in the past two weeks.

Spot gold was trading steady at $1,294.65 an ounce by 0308 GMT and was headed for a flat week.

"Gold has been trapped in a very compressed range for well over a month, but we suspect that we could see a substantial move in the days ahead once the Ukrainian elections are over," INTL FCStone said in a note.

Ukraine said more than a dozen servicemen were killed on Thursday in an early morning clash with pro-Russian separatists, fuelling security concerns ahead of a presidential election on Sunday

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