Metals Surge on Fiscal and Trade Fears: Platinum ETFs Boom

Investors are piling into precious metals last week, seeking shelter from growing concerns over U.S. fiscal policy and inflation. The House’s approval of a sweeping new tax bill—expected to balloon the federal deficit by $3.8 trillion over the next decade—has markets bracing for long-term inflation and rising yields. While the Senate still needs to weigh in on the controversial legislation, traders aren’t waiting around. Gold and platinum are climbing on a mix of safe-haven demand and supply worries, with platinum leading the charge.

Gold Holds Firm Despite Mixed Signals

Gold took a brief hit, slipping below $3,340 per ounce after President Trump announced a delayed 50% tariff on European goods—a move that temporarily eased market jitters. Lingering geopolitical tensions and a softer U.S. dollar had pushed prices back above $3,300 last week, closer to the previous all-time high recorded earlier this month. Analysts point out that while investors are still drawn to gold in uncertain times, sky-high prices might be cooling physical demand in key markets like Asia. Still, China’s central bank remains a major buyer, with recent import quota hikes signaling ongoing institutional accumulation.

Platinum Soars on Tight Supply and Industrial Demand

Platinum stole the show last week, jumping to $1,090 per ounce—its highest level in over a year—as traders priced in a looming supply crunch. The World Platinum Investment Council predicts a nearly one-million-ounce deficit in 2025, fueled by a 4% drop in global production, especially from struggling South African mines.

While platinum’s use in traditional auto catalysts may decline as electric vehicles take over, other industries are picking up the slack. The metal is crucial for hydrogen fuel cells, petroleum refining, and even medical devices. And it’s not just factories driving demand—platinum jewelry is gaining traction in China, with Q1 purchases up 26% year-over-year, likely as buyers seek alternatives to gold’s steep prices.

ETP Flows Highlight Strong Demand for Both Metals

Platinum ETPs led the charge last week, but gold funds weren’t far behind. The WisdomTree Physical Platinum ETC (PHPT) surged 8.0%, while the iShares Physical Platinum ETC (IPLT) gained 8.01%. Gold ETFs also posted solid gains, with Xetra-Gold (4GLD) climbing 3.80% and Amundi Physical Gold (GOLD) rising 3.18%, reflecting steady institutional interest.

Overall, precious metals ETPs pulled in over $319 million last week, with platinum funds averaging an 8.07% gain and gold ETFs up 3.08%. As fiscal uncertainty rattles markets, metals like platinum, scarce in supply and backed by industrial demand, are outperforming, but gold remains a key hedge as inflation fears linger.

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Please note this article is for information purposes only and does not in any way constitute investment advice. It is essential that you seek advice from a registered financial professional prior to making any investment decision.