Precious metals continued their tumble for the second consecutive day on Wednesday as hopes for further easing measures in the US disappeared. Broadly stronger US Dollar and weaker global equities also weighted down on the commodity group. Lingering concerns over the Euro Zone’s economic state after disappointing Spain and Italian bond auctions created a downward pressure on precious metals. Gold lost 1.54% as strikes in India ended and China’s traders were still out from the market due to holiday. Other precious metals followed the gold’s suit. However, platinum and palladium may find support on the improving car sales worldwide. Palladium may face growing supplies as Papuan Precious Metals Corp. started mining at its palladium mine.
Interchange between palladium and other precious metals improved after disappointing Fed minutes. Meanwhile, palladium’s link to Standard Poor’s SP500 (SPX) soared from 0.78 to 0.80 amid inspiring US labour market data. At the same time connection between palladium and EUR/USD eased up from 0.31 to 0.34 following unsuccessful Italy and Spain debt sale.
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