Platinum Poised to Outperform Gold as Debasement Trade Resumes Momentum – WPIC

Inflation concerns are pushing expectations for earlier Federal Reserve rate hikes, weighing on precious metals like platinum. Nevertheless, the World Platinum Investment Council highlights that underlying market fundamentals stay tight, with investment demand likely to strengthen later this year.

The latest WPIC Platinum Quarterly revises the 2026 outlook to a modest surplus of 265,000 ounces, up from a prior deficit forecast of 297,000 ounces. A first-half surplus of 548,000 ounces resulted largely from ETF outflows of nearly 600,000 ounces, but the second half is projected to shift to a 283,000-ounce deficit.

Edward Sterck, WPIC's research director, explained that platinum's 24% price drop this year ties to Middle East tensions raising oil prices and inflation bets, leading to anticipated Fed hikes. Still, the metal demonstrates resilience, with its correlation to gold rising to 0.95 and a beta of 1.3, positioning it for potential outperformance in a debasement scenario.

Mine output remains steady at 5.55 million ounces, while industrial demand grows 5% to 2.385 million ounces, partly due to AI applications. Year-end inventories are seen at 2.01 million ounces, or 3.4 months of demand.