Palladium started the week on a back foot after it finished on the negative zone on Monday trading as concerning signals from world’s top gasoline auto markets, China and the United States, weighed in on the prices of metal.
The commodity snapped its winning streak as it lost 0.3% to settle at $858.49 per ounce. Despite the decline, prices of palladium still remained near its 16-year high.
The loss suffered by the silvery white material was caused by poor sales from US and China. Now on their driving season, both countries have recorded a slow pace of growth as car sales fell sharply in May compare to a year prior.
It was a rare loss for palladium as the commodity has been enjoying its hot streak in the first six months of the year to be touted as the hottest and best performing commodity in 2017. So far, it has registered a massive gain of 25% in the first half of the current year.
According to experts, the surge was spurred by a stronger investment demand for gasoline cars rather than industrial demand. Palladium is known for its ability to curb harmful fumes from gasoline vehicles.
And with a sentiment in the market showing that consumers are switching to gasoline from diesel, palladium becomes a top attraction for auto makers.
Earlier this month, it touched its highest settlement in more than 16 years after it closed at $914.7 an ounce.