Palladium to perform well once economic picture brightens: BNP Paribas
Gold | 2012-07-27 09:23:19
Palladium has a "solid fundamental picture" and should perform well once the economic outlook improves, says BNP Paribas in a commodities briefing.
By Paul Ploumis
LONDON (Scrap Monster): Palladium has a "solid fundamental picture" and should perform well once the economic outlook improves, says BNP Paribas in a commodities briefing.
The palladium market ended 2011 with a small surplus mainly due to investor disinvestment. “We expect the market to return to a deficit in 2012, and this deficit to remain until the end of our forecast period,” BNP added.
The bank continued that, “inventories at the end of 2011 may have fallen close to 11.2mn ounces, or 15 months of demand cover. But with several years of supply deficits ahead of us, this surplus should gradually decline. So far this year, Russian palladium exports to Switzerland in H1’12 stand at nearly 40% of the 2011 total.”
“Given irregularity in monthly shipments, it is difficult to read much into this. We continue nonetheless to expect supply from Russian state inventories to gradually come to an end in the next two to three years,” they added.
The bank’s revised average price forecasts are $665 an ounce for 2012 and $900 for 2013.
