Palladium firms near record, gold accelerates as Ukraine worries mount

Palladium hovered marginally below an all-time peak in volatile trading on Tuesday as the Russia-Ukraine crisis fueled worries of a supply squeeze of the metal, while safe-haven gold jumped 3%, staying atop the key $2,000 level

Spot palladium climbed nearly 5% to 3,045.50 in early morning trading. It swung between gains and losses in choppy price action, rising as much as 7.5% and falling by 3.4%

Investors also took stock of the London Platinum and Palladium Market’s statement that Russian refiners can continue to sell platinum and palladium in London. Removal of palladium, traders and analysts said, would have worsened worries over supply from major producer Russia

The metal has surged about 60% so far this year, having hit a record high of $3,440.76 on Monday

In the event of shortages, car manufacturers would be willing to pay almost any price for the metal to keep up production, said Saxo bank analyst Ole Hansen

Spot gold rose nearly 3% to $2,054 per ounce. Platinum rose 6% to $1,184.60

Gold continues to be a low volatility safe haven, said Saxo bank analyst Ole Hansen. “We are going to face a period of extremely high inflation where central banks will be struggling to put up a defence because of other constraints. And that will continue to attract investors into the gold market

Gold is traditionally considered a safe store of value during such global crises and soaring inflation as oil prices surge

Meanwhile, the market has scaled back the probability of a 50 basis hike from the U.S. Federal Reserve, “which has removed some of the resistance for gold prices,” said Xiao Fu, head of commodities markets strategy at Bank of China International