Analysts and traders have lowered their outlook for platinum prices next year, a Reuters poll showed on Thursday, after the metal plunged 16 percent in its biggest quarterly drop in seven years. The survey of 30 analysts and traders conducted over the last two weeks returned an average platinum price forecast for 2016 of $1,105.50 an ounce, 12 percent below the average forecast of a similar poll conducted three months earlier.
Platinum, which has averaged $1,093 in the year to date, is expected to average $1,080 an ounce in 2015 after slipping to $998 in the fourth quarter. Prices have suffered from perceptions that supply remains plentiful, after an historic five-month miners' strike in South Africa last year failed to push prices much higher.
Demand has also been lacklustre this year, with weakness seen in Chinese platinum jewellery buying, which accounts for a fifth of global consumption. Prices have also eased on concerns that demand for diesel cars, which use platinum in their catalytic converters, may be hurt by the Volkswagen emissions scandal. "Clearly the VW story has added to the already bearish outlook for platinum, given the lack of price response to last year's strike action," Fastmarkets analyst James Moore said.
"While prices appear to be stabilising, the ability to rally will largely depend on the producers, and whether deeper production cuts are announced." Price forecasts for palladium have also been cut, though less severely. The metal is now expected to average $745 per ounce next year, compared to a forecast of $820 made three months ago.
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