Platinum Forecast: XPT/USD Rate 2021, 2022-2025 and Beyond

2021-06-11 2021-06-11 Platinum forecast: XPT/USD rate for 2021, 2022-2025 and beyond

Yana Kane

In this article, we will discuss whether platinum could become an attractive investment asset in the coming years and discuss its price dynamics. We will also look at current quotes, discuss the use of precious metals, price forecasts and reasons for the depreciation. Finally, we will pay special attention to investment opportunities.

In this article we will look at:

• Latest events
• Platinum: price today
• Expert forecast for platinum exchange rate
• Technical analysis of platinum versus US dollar
• Platinum price forecast for 2022
• Platinum price forecast for 2023
• Long-term platinum price forecast for 2025-2030
• Platinum: price change over 10 years
• Factors that may affect the platinum rate
• What will the course be in the future? Should you buy platinum now?
• Platinum price forecast FAQ

Latest events

At the beginning of 2021, the platinum rate was $985 per ounce, and at the end of the year it rose to $1,000. In March 2021, the price fell to a record low of $606 due to massive asset sales during the pandemic. But then it recovered to the level of $950-1000 per ounce. Despite the volatility, the price of the precious metal has stabilized; investors took the depreciation as an opportunity to buy.

Platinum is a relatively cheap metal that is historically undervalued. Investors became interested in it in 2021. White metal ETF volume reached 3.8 million ounces in August 2021, an increase of 543 thousand ounces, an all-time high. Net purchases of platinum bars in Japan in the first half of 2021 exceeded 200,000 ounces, the highest level since the first half of 2021.

Although the chemical element of platinum appears as Pt, its ticker symbol in the financial markets is XPT.

In the first half of 2021, demand for platinum on the Shanghai Gold Exchange (SGE) has surged. At the same time, demand for platinum jewelry has increased. But in the second half of the year it decreased. However, the large gap between platinum and gold and new jewelry has partially restored interest in the white metal.

After Joe Biden wins the presidential election, platinum may become more expensive than gold. The fact is that the United States and other leading countries are switching to green energy. Consumption of fossil fuels will decrease, and hydrogen will become a key element.

The use of platinum will play a key role in the hydrogen economy - the precious metal is necessary for fuel cells and the production of hydrogen through the electrolysis of water. Platinum is expected to rally in 2021 due to reduced supply and increased demand.

Chips dropped the auto industry, the auto industry dropped platinum

Over the past five years, platinum has enjoyed stable demand in the market, notes, in turn, TeleTrade chief analyst Pyotr Pushkarev. Periodically, its exchange value briefly rose above $1,000 per ounce, then returned to a more familiar corridor, most of the time limited to a range from $780 to $950. True, after the viral collapse of all commodity assets in March 2021, platinum prices briefly dropped to the clearly much lower level of $562 per ounce, and then immediately bounced back.

This price swing, combined with rushing demand for another key industrial metal of the platinum group - palladium - which literally tripled in price between 2021 and 2021 (from around $900 to a peak of $2,789 per ounce), ultimately led to a counterbalancing and no less impressive jump in the price of platinum. TO

in February of this year, it had already reached almost $1,350 - against the backdrop of a technically rational idea of ​​gradually replacing palladium, which had become immensely expensive, with platinum in the production of catalytic converters for gasoline cars. However, Pushkarev notes, the implementation of this idea turned out to be much more difficult than representatives of automobile companies expected, and will be noticeably extended over time, not to mention the obvious additional costs during the transition phase.

That is why the exchange price of platinum, having quickly passed through the peak values, first bounced down from them, falling during the correction by more than 18% in literally three weeks, to the region of $1,100, and then remained until May significantly below the peaks - in the corridor from 1,150 up to $1,280 per ounce. Next, an acute shortage of chips played a cruel joke on platinum and palladium, which led, starting in mid-summer, to a rapid and almost simultaneous collapse in prices for both metals.

At the height of the pandemic, automakers recklessly canceled orders for chips or reduced their volumes, Pushkarev reminds his colleagues. Ford factories, for example, announced a temporary reduction in the production of pickup trucks by 33% by August precisely because of a shortage of microchips, although the company could now sell even more cars than before the pandemic - if estimates are based on the number of orders. In Asia, production was less affected, but the Japanese Toyota announced that it was reducing assembly plans by as much as 40% (both in North America and in Japan), although for now only for two months. But one way or another, in September the concern has already produced 360 thousand fewer cars, and it is not yet known what the reduction numbers will be in October.

Naturally, due to the forced decline in car production, purchases of platinum group metals for the manufacture of catalysts have sharply decreased, agrees Pushkarev. Combined with the previous significant overheating of the market in terms of prices, this led to a powerful pullback in palladium, including against the backdrop of fears of too early curtailment of the US Federal Reserve’s monetary policy stimulating production and demand.

Expert forecast for platinum exchange rate

Let's see what industry experts have to say about the price of the precious metal:

1. Investinghaven

We should expect strong price growth in 2021. Ultimately, the PL futures market price could rise by 80% ($1,800 per ounce) in 2022 or later. This year, the target rates will be $1,350 and $1,500. The prerequisite for this was an increase in the forecast to $1045 per ounce, which happened. According to Investinghaven, the future of platinum for 2021 is very optimistic.

2. Walletinvestor

According to analysts at Walletinvestor, platinum can be a profitable investment if you are looking for commodities with good returns. According to the portal’s forecast, the precious metal will experience long-term growth. The expected price on March 6, 2026 is $1,379.590 per ounce. It is assumed that with a 5-year investment, the revenue will be about +14%.

3. Neal Froneman

Neil Froneman, CEO of Sibanye Stillwater Ltd, the world's number one platinum miner, believes that over the next 4-5 years, as economic growth and supply tightens, the price of the white precious metal could rise by more than 80%. “Platinum has just started to recover and this trend will continue,” Froneman said. “There’s no reason why this metal won’t eventually trade at $2,000 an ounce, and possibly more.”

Forecasts for the price of platinum.

After prolonged strikes in South Africa, there was a decrease in supplies. Everyone was expecting a price jump, however, this did not happen due to the emergence of a secondary market for platinum (catalyst recycling). At this time, South Africa again began to increase its supply of platinum, which again reduced the price. If in 2014 the price per troy ounce was 1.5 thousand dollars, then in 2015 it was already 1.2 thousand dollars, although everyone expected an increase. In 2016-17 the price was about 1.1 thousand dollars, and in 2018 it is predicted at 1 thousand dollars.

Technical analysis of platinum versus US dollar

Let's start our technical analysis of the XPTUSD chart by looking at the monthly timeframe.

An ambiguous situation is emerging. On the one hand, the platinum price chart shows the possible emergence of a bullish trend. This is evidenced by the rapid upward movement of the price of XPTUSD quotes, accompanied by the updating of local extremes. On the other hand, along with an upward surge comes a decrease in trading activity, and this is a manifestation of weakness on the part of the buyer.

The current uncertainty will largely be resolved in the coming months, when it becomes clear whether platinum will be able to overcome the resistance level around 1200 USD and continue its upward movement or will push away from it, confirming the forecast for the development of a flat.

XPTUSD rate analysis for 3 months

To make a realistic forecast for XPT to USD for the next three months, we will analyze the weekly timeframe.

For clarity, let's look at the MACD. During the formation of the current peak, the moving average of the indicator crossed the signal curve from top to bottom and rushed to the zero mark (blue oval). Together with the chart moving into the negative zone, this signal confirms that the price of platinum will decrease in the future.

Therefore, the most likely forecast is bearish. Taking into account the cyclical nature of the trend, the projected price of platinum will decrease over the next 2-3 months. The expected fall is limited by the strong psychological level of 1000 USD.

If the bulls fail to defend the $1,000 price, there will be an opportunity to open short trades with a small stop. This will increase the pressure on the buyer. The next likely target will be the support level around $561.

What will the platinum rate be in 2021?

We will conduct a technical analysis of the daily chart of platinum against the US dollar and make a detailed forecast for the entire 2021.

Having studied price history and changes in the width of Bollinger Bands, in the chart above I have depicted projections for each month of the current year in accordance with the most likely scenario for market movement.

Until mid-autumn, the expected trading range for platinum will be between 1000–1200 USD. A short-term correction will most likely end at $1000, but for this to happen, the price must first break through the blue uptrend line. Whether sellers will be able to do this or not is an open question.

The behavior of the XPTUSD pair in the summer will show how strong the bearish potential of platinum is. If a breakout does not occur, then the entire corrective formation risks turning into a volatile sideways trend.

One way or another, in October - November platinum trading is expected to be at levels above 1200 USD, so the spread of boundaries in the projections is very wide. The table below provides estimated price ranges for each month of 2021.

Technical analysis on XPTUSD was provided by Mikhail Khaipov.

Where to open a metal account in platinum?

Many Russian banks offer services for opening compulsory medical insurance. To do this, the client opens an account in which the purchased metal is accumulated. The account owner monitors the price. As soon as the opportunity arises, he can buy more platinum or sell at an increased price, earning income. Compulsory medical insurance accounts are perpetual accounts; there are no additional interest charges on the balance. Income is generated solely from the growth of rates. In the case of compulsory medical insurance, there is no risk of metal theft (coins and bars can be stolen). Since the amount of metal does not change (100 grams of platinum will remain 100 grams even after 10 years).

If an investor had invested 100 rubles in platinum a year ago, when the average selling rate was 1,730 rubles. per gram (57.80 grams) and would sell it in 2021 at the purchase rate at Gazprombank for 1,722 rubles. per gram, then I would have lost 463 rubles, receiving only 99,537 rubles. As you can see, investing in platinum is not always profitable.

Platinum price forecast for 2022

Below is the exchange rate forecast for 2022. Please remember: long-term forecasts are estimates only and may change at any time.

Source: Longforecast.com

Platinum price forecast for 2023

Source: Longforecast.com

Long-term platinum price forecast for 2025-2030

During this period, the rate will increase from $2805 to $4622. Platinum will start 2028 at $3,506, then reach $3,508 in the first six months and end the year at $3,582. This is approximately +196% to today's rate. By the end of 2030, the price could rise to $4,144.

Source: Coinpriceforecast

Factors that may affect the platinum rate

Platinum group metals are found in nature much less frequently than gold. The metal is mainly mined in the Republic of South Africa. Russia and Canada are also major producers. More than 50% of the demand for this metal comes from industry, most of all from the automotive sector. The metal is widely used as a catalyst and is also used in the production of electronics, paints and kerosene.

The following factors can affect the price of platinum:

Diesel scandal

Platinum is widely used to make catalytic converters in the automotive industry - the precious metal helps reduce the amount of harmful exhaust gases. The diesel scandal has had a negative impact on sales of diesel vehicles. The result is that demand for platinum has decreased.

Trade wars

As stated earlier, the metal is widely used in industry. Based on this, trade conflicts have had a negative impact on demand and, consequently, on the price of platinum.

Hydrogen

Will we drive electric cars in the future or will we prefer hydrogen-powered cars? Giants such as Volkswagen and Audi are investing heavily in new technologies. Fuel cell catalysts require a lot of platinum. Consequently, increased investment in hydrogen will lead to increased demand for the white metal.

South African problems

About 70% of South Africa's platinum mines are currently unprofitable. The mines are only operated due to low local employment, and their closure will lead to even greater job losses. However, the use of mines at current prices seems unacceptable. Strikes and closures of production will lead to a significant decrease in the supply of the precious metal - this will have a positive impact on its projected value.

Shortage

It can be assumed that in the long term, prices for precious metals will continue to rise. After all, there are finite resources. Since platinum is rarer than gold, the negative ratio of white to yellow metal may well be temporary.

Mining and use of platinum

The world's platinum reserves are distributed extremely unevenly. As mentioned above, production takes place in South Africa and Russia near Norilsk. Based on this, the only significant player in the metal supply market is South Africa. After lengthy strikes at platinum ores in South Africa, supplies of the metal began to decline in 2012. The market did not observe a strong surge in price even against the backdrop of a shortage. When supplies returned to normal, platinum began to actively fall in price and in 2021 it became almost twice as expensive as in 2012. Since the end of 2021, the metal has started to grow again due to a decrease in supplies. Supplies began to decline due to lower demand.

If the currency is pegged to the gold equivalent, then this does not apply to platinum. Metal in its pure form is rarely used for investment purposes. Platinum's importance is significant in the jewelry industry, which uses more than a third of all metal supplied. At the same time, 20% is consumed by China.

What will the course be in the future? Should you buy platinum now?

Given the current price and opportunity, investing in platinum can be a great way to diversify your portfolio. The price is volatile - the precious metal has many industrial uses.

Now platinum is a very attractive asset. In recent years, it has become increasingly cheaper compared to other precious metals. This metal is used not only in the automotive industry, but also in the jewelry industry. Below is the forecast for 2021:

Source: Longforecast.com

Once the coronavirus crisis is over, metal will be able to catch up. As the global economy recovers, demand for cars will increase. The precious metal will only benefit from this - demand for it in the automotive industry will increase significantly. And in the future, you can sell platinum very profitably.

As the economy recovers, the demand for platinum jewelry will also increase. In China, the largest market for platinum jewelry, the metal has great potential for growth in the coming years. Finally, now that the white metal has become much cheaper than gold, more and more investors will become interested in investing in platinum. Be sure to create a free demo account at LiteForex! You'll be kept up to date with forecast commodity prices, and the user-friendly interface will help if you decide to start investing and trading.

How can you invest in platinum?

The most reliable option is a bank. The main thing is to study the conditions and imagine what kind of income you can get. There are several ways to invest:

• Unallocated accounts in metal. To open it, you only need a passport. The account takes into account the metal in grams. Income will be recorded in rubles based on the date of purchase and sale. The account owner can deposit and withdraw money by selling metal at the current rate. If you own the account for more than 3 years, you don’t have to pay 13% tax. If less than 3 years, you will have to file a tax return on the income received and pay 13% on the amount of income.
• Ingots. Buying platinum bars is not as popular as buying gold, so you can buy them from a limited number of banks. You will have to pay VAT upon purchase if the bullion is removed from storage. If you leave it for safekeeping in a bank, then you do not need to pay VAT, however, you will have to pay for storage. Buying an ingot is easy. It's harder to sell it back. Banks have a whole set of standards for the appearance of bullion. The slightest scratch reduces the price.

• Coins. Coins are not subject to VAT, which makes them more attractive than bullion. In Russia, the issue of platinum coins was discontinued in 1996. Experts call investing in platinum coins the “exotic way.” There are few platinum coins, so they will be in demand by a small number of numismatists. Since the difference between the purchase price and the sale price in the bank is significant, it is possible to make money only in the long term.

Platinum price forecast FAQ

The current rate is $1,044.09.
According to various expert forecasts and technical analysis, the value should increase in the medium term. In the long term, the price trend of the projected growth will double.

If there is negative news regarding platinum, such as the Dieselgate scandal, this will lead to the outbreak of trade wars, a rise in the US dollar, or a fall in prices for the white metal. Today prices should not decrease.

The rate recently reached its 4-year high. Based on promising forecasts from various sources, the price of platinum is not expected to fall below 5% of its current level.

The price forecast for the next 5 years looks positive. The projected price in mid-2026 is $3,036 and could reach $3,230 by the end of the year.

Is it worth investing in the white metal, and will it be profitable in 10 years? Projected prices will reach approximately $4,000.

The metal's value rose due to stagnation in the gold price as an improving global economy reduced the need for safe-haven assets, prompting investors to look for other options.

Apparently, the price of white metal will rise. New price highs are just around the corner, especially as the World Platinum Investment Council estimates that investment demand will increase in 2021.

The long-term outlook looks quite optimistic, with many analysts suggesting that XPT should see a long-term uptrend towards $3,000 or higher over the next five years. However, daily fluctuations can be characterized by falling prices, reflecting trading volumes as well as supply and demand in the market at a particular moment.

Therefore, to analyze the market and make a short-term forecast of platinum prices for tomorrow, you should use technical indicators.

The best trend indicator for analyzing the future price of platinum in the short term is the Bollinger Bands indicator. The combination of RSI and Stochastic provides the best performance among oscillators.

There is nowhere lower. It's time to grow

Recent days have been negative for the platinum market, notes TeleTrade chief analyst Mark Goikhman. Quotes on July 16-19 fell from 1138 to 1074 dollars per troy ounce, that is, by 5.6%. Half of this drop occurred on Monday - 2.8%. Platinum fell under sales, as they say, “on a general basis.” Risk assets associated with production - raw materials, stocks, metals, etc. - have become victims of increased negative sentiment due to the spread of new, more aggressive strains of coronavirus. In addition, recently there have been increasingly louder messages regarding the future winding down of the Fed's monetary stimulus due to high inflation in the United States. Meanwhile, it is the Federal Reserve’s soft policy and its massive injections of money into the economy that support investment in productive assets.

On July 20, however, the metal stopped its peak, primarily due to technical circumstances. The price reached a strong support level of 1065-1073 dollars, winning back current factors. And after a massive fall in

Tuesday there is some natural rebound upward - to 1075-1076 dollars. There is also a possibility of a certain growth: above 1100 dollars in the near future. During the week, Goikhman believes, quotes will not change much - within the range of $1,064-$1,100. Few significant events that could affect the platinum market are expected: a meeting of the European Central Bank on Thursday and data on business activity in the US, Eurozone and UK on Friday.

But in general, the prospects for rising prices look very serious, Mark Goikhman is sure. He believes that it makes sense to consider investing in platinum from levels of $1,064-$1,070. Platinum, contrary to popular belief, is not so much a precious metal as an industrial one. According to the World Platinum Investment Council (WPIC), 36-43% of it is used in the automotive industry, 21-26% in other industries, 26-35% in jewelry and up to 15% for investment purposes.

This means, the expert believes, in the event of a likely continuation of economic growth and auto production, the demand for platinum in the world will begin to recover, while its supply is limited - the metal is mined mainly in South Africa, which continues to suffer from the pandemic and insufficient vaccination).