Palladium prices rose during Monday’s trading session, supported by continued positive expectations for strong demand for the industrial metal this year.

Amid sustained demand for platinum group metals (PGMs), BofA Securities’ global research team raised its 2026 price forecast for platinum to $2,450 per ounce from a previous estimate of $1,825, and lifted its palladium forecast to $1,725 per ounce from $1,525.

Key takeaways from the bank’s weekly Global Metals Markets report, dated January 9, showed that trade-related disruptions to PGM flows continue to keep markets tight, particularly the platinum market. The report also noted that Chinese platinum imports are providing additional price support.

While a supply response is likely, the bank expects it to be gradual, citing what it described as “production discipline and limited mine supply elasticity.”

These forecasts come as platinum and palladium prices continue to rise this year, with spot prices reaching $2,446 per ounce for platinum and $1,826 per ounce for palladium.

Both metals have now exceeded the bank’s previous forecasts, prompting the upward revision in price estimates.

In comments to Mining Weekly, the bank said it continues to expect platinum to outperform palladium, supported by persistent market deficits.

The bank noted that US tariffs have had a clear impact on several metals markets, and that the risk of additional tariffs continues to loom over PGMs.

This has been one of the factors behind rising inventories at the Chicago Mercantile Exchange, alongside a surge in exchange-for-physical (EFP) activity.

Palladium EFPs have been particularly strong, driven largely by growing concerns over the potential imposition of US tariffs on Russian palladium, amid ongoing anti-dumping and countervailing duty investigations.

In this context, the bank said the US Department of Commerce has estimated the dumping margin for unworked Russian palladium at around 828%.

The bank added that the imposition of tariffs on as-yet-unspecified Russian volumes could push local prices higher, given Russia’s role as a key palladium supplier.

Chinese import demand adds further price support

Outside the United States, China has provided additional support to prices. Early in 2025, a sharp recovery in jewellery sector activity drew more ounces into the Chinese market. With gold prices at record highs, this development is particularly significant, as substituting as little as 1% of gold jewellery demand could widen the platinum deficit by around one million ounces, equivalent to roughly 10% of total supply.

In the second half of 2025, the launch of physically backed platinum and palladium futures contracts on the Guangzhou Futures Exchange (GFEX) provided further support to prices.

These contracts represent China’s first domestic hedging tools for PGMs, denominated in renminbi, and allow for physical delivery of both bars and sponge metal. The bank said improved physical liquidity was a key driver behind the sharp price rally seen in December.

China’s palladium imports have also quadrupled since September compared with the previous year, a development the bank described as difficult to explain on fundamental grounds given the ongoing shift away from internal combustion engines. It suggested the surge is largely linked to the launch of palladium futures on the Guangzhou exchange.

Gradual supply response expected

With PGM prices now trading above marginal production costs and incentive prices for investment, markets are closely watching the potential supply response.

The bank said it expects any response to be measured, noting that producer margins — particularly in South Africa and North America — have remained under pressure over the past two years, which may encourage caution in expanding output.

New supply additions are also likely to emerge only gradually, reflecting long lead times from development to steady-state production.

Many ongoing projects represent incremental expansions or phased increases, rather than sources of rapid, large-scale supply growth.

On the supply side, production challenges in South Africa tightened the platinum market in 2025. Mine output in the country fell by around 5% year on year between January and October 2025, mainly due to operational issues such as flooding and plant maintenance in the first quarter. The bank expects a modest recovery in South African platinum output this year, but not enough to eliminate the market deficit.

In Russia, the world’s largest palladium supplier, production has also faced challenges as Norilsk Nickel transitioned to new mining equipment and dealt with changes in ore composition. As a result, the company’s platinum output fell 7% year on year and palladium output declined 6% during the first nine months of 2025. As these temporary disruptions fade, Russian PGM production is expected to recover this year, potentially capping the pace of palladium price gains.

While higher prices can incentivize increased supply, the bank believes additional volumes are more likely to come from life-of-mine extensions and project restarts rather than rapid capacity expansions.

In practice, most new supply requires several years to move from construction to full production, and many projects currently under development are expansions or phased increases rather than immediate sources of large additional volumes.

The bank noted that two major new projects — Ivanhoe Mines’ Platreef project and Wesizwe’s Bakubung project in South Africa — are progressing toward production and are expected to add a combined 150,000 ounces of platinum and 100,000 ounces of palladium this year.

Other expansion projects remain longer-term and depend on final investment decisions. Among them is Valterra Platinum’s Sandsloot underground project at the Mogalakwena mine, which is not expected to reach an investment decision before 2027, with underground ore production unlikely to begin before 2030.

In trading, March palladium futures rose 3.25% to $1,931 per ounce by 16:21 GMT.

Bitcoin rose during Asian trading on Monday, holding broadly steady compared with last week, as risk appetite remained under pressure amid escalating tensions between US President Donald Trump and the Federal Reserve.

Persistent global geopolitical uncertainty, alongside caution ahead of key US economic data due later this week, also kept markets in a wait-and-see mode.

Bitcoin underperformed the rally in technology stocks, which were supported by improving sentiment toward artificial intelligence. While the world’s largest cryptocurrency often moves in tandem with tech equities, this correlation appears to have weakened gradually over the past year.

At the same time, the absence of clear positive catalysts for crypto markets has kept Bitcoin under pressure through late 2025 and into early 2026.

Bitcoin rose 1.5% to $92,094.4 by 00:51 ET (05:51 GMT).

Federal Reserve indictment risks and geopolitical tensions cap risk appetite

A renewed hit to risk appetite on Monday limited further gains in Bitcoin.

Federal Reserve Chair Jerome Powell said the central bank had received a subpoena from the US Department of Justice and that he faces the possibility of criminal charges related to ongoing renovation work at the Federal Reserve’s headquarters.

Powell suggested the investigation was politically motivated, pointing to repeated calls from the Trump administration for aggressive interest rate cuts.

Powell’s remarks weighed on US equity futures and triggered a renewed move into safe-haven assets, led by gold and other precious metals. Markets voiced concern that the escalating conflict between Trump and the Federal Reserve could undermine the central bank’s independence, particularly as Trump prepares to nominate Powell’s successor in the near future.

Risk aversion was further reinforced by persistent global geopolitical uncertainty. Trump renewed calls for the United States to take control of Greenland, a scenario that has unsettled markets further following last week’s US intervention in Venezuela.

Meanwhile, the diplomatic crisis between China and Japan showed no signs of easing, while attention also remained focused on widespread protests in Iran and ongoing fighting between Russia and Ukraine.

Cryptocurrency prices today: modest gains in altcoins ahead of US inflation data

Other cryptocurrencies posted modest gains alongside Bitcoin on Monday but remained largely within their recent trading ranges.

Market focus this week is firmly on US consumer price index data for December, due on Tuesday, which is expected to play a key role in shaping interest rate expectations.

Ether, the world’s second-largest cryptocurrency, rose 2% to $3,160.47, while XRP slipped 0.6%.

Oil prices fell on Monday after Iran said the situation was “fully under control” following the largest anti-government protests the country has seen in years, easing some concerns over supply disruptions from the OPEC member, as investors also assessed efforts to resume Venezuelan oil exports.

Brent crude futures slipped 15 cents, or 0.2%, to $63.19 per barrel by 12:48 GMT, while US West Texas Intermediate crude fell 19 cents, or 0.3%, to $58.93 per barrel.

Giovanni Staunovo, analyst at UBS, said that “the decline in European equity markets and the absence of further supply disruptions are exerting mild pressure on oil prices, following the strong gains seen late last week.”

Both benchmark crudes rose more than 3% last week, marking their largest weekly gains since October, after Iran’s ruling clerical establishment intensified its crackdown on the biggest protests since 2022, even as demonstrations escalated over the weekend.

Trump warns on Iran intervention

Iranian Foreign Minister Abbas Araghchi said on Monday, in comments translated into English, that the situation in Iran was “fully under control” following widespread protests over the weekend.

US President Donald Trump has warned of possible military intervention in response to the violent suppression of protests in Iran. A human rights group said on Sunday that more than 500 people had been killed during the civil unrest.

Trump is expected to meet senior advisers on Tuesday to discuss options related to Iran, according to a US official.

Despite a risk premium forming in oil prices over recent days, the market continues to downplay the scale of geopolitical risks stemming from a broader conflict with Iran, which could disrupt oil shipments through the Strait of Hormuz, according to Saul Kavonic, head of energy research at MST Marquee.

“The market is saying: show me actual supply disruption before reacting in a meaningful way,” Kavonic said.

Venezuela prepares to resume oil exports

Venezuela is expected to resume oil exports soon following the ouster of President Nicolás Maduro, after Trump said last week that the government in Caracas would deliver up to 50 million barrels of sanctioned oil to the United States.

This has triggered a race among oil companies to secure tankers and prepare operations to safely load crude from Venezuela’s aging vessels and ports, according to four sources familiar with the matter.

At a White House meeting on Friday, Trafigura said its first tanker is expected to begin loading within the coming week.

Investors are also monitoring risks of supply disruptions from Russia, amid Ukrainian attacks targeting Russian energy infrastructure and the possibility of tougher US sanctions on Russia’s energy sector.

Goldman Sachs said in a note on Sunday that oil prices are likely to trend lower this year as a wave of new supply creates a market surplus, although geopolitical risks linked to Russia, Venezuela, and Iran will remain a key source of price volatility.

The investment bank maintained its 2026 average price forecasts at $56 per barrel for Brent crude and $52 for West Texas Intermediate, and expects prices to bottom at $54 and $50 per barrel, respectively, in the final quarter of the year, as inventories build across OECD countries.

The US dollar weakened, while US equity futures declined and gold surged on Monday after Federal Reserve Chair Jerome Powell said that the administration of President Donald Trump had threatened him with criminal charges related to renovation work at the central bank’s headquarters.

The development triggered unprecedented concerns over the independence of the Federal Reserve from political influence, adding further strain to a volatile start to 2026, which has already seen the United States arrest Venezuelan president Nicolás Maduro and an escalation in rhetoric around potential control over Greenland.

S&P 500 futures fell by more than 0.5%, while gold — a traditional safe haven used to hedge against turmoil and inflation — climbed to a fresh record high, as markets priced in a slightly higher probability of US interest rate cuts in the near term.

European markets opened around 0.2% lower from record levels. The Swiss franc, another traditional safe haven, rose 0.6% to 0.796 against the dollar, while the euro gained 0.4% to $1.168.

Lee Hardman, market analyst at MUFG, said that “this latest development represents a significant escalation in the conflict between President Trump and Fed Chair Powell,” adding that “repeated attacks on the Federal Reserve’s independence continue to pose downside risks to the dollar.”

Federal funds futures added around three basis points of additional rate cuts priced in for this year. While modest, the move signals a risk that the central bank could be pushed toward a more accommodative policy stance.

Gold rose to a new record above $4,600 per ounce, also supported by rising geopolitical tensions surrounding Iran, while oil prices showed little reaction.

Trump said on Sunday that he was considering a range of strong responses, including military options, to the violent suppression of protests in Iran, which represent one of the biggest challenges to the country’s clerical establishment since the 1979 Islamic Revolution.

Iranian Foreign Minister Abbas Araghchi said on Monday, in comments translated into English, that the situation was “fully under control.”

Brent crude futures slipped 9 cents to settle just above $63 per barrel in early London trading, while US West Texas Intermediate fell 10 cents to $59.02 per barrel.

Both benchmarks had risen more than 3% last week, marking their strongest weekly gains since October, as Iran’s ruling authorities intensified crackdowns on protesters.

Despite a recent risk premium forming in oil markets, investors are still downplaying the threat of broader disruption, even though a wider conflict could affect the Strait of Hormuz, according to Saul Kavonic, head of energy research at MST Marquee.

“The market is saying: show me actual supply disruption before reacting in a meaningful way,” Kavonic said.

The second full week of the year is set to feature US inflation data, Chinese trade figures, and the start of the US corporate earnings season, led by JPMorgan Chase and Bank of New York Mellon on Tuesday. However, traders appeared to view these events as secondary for now.

Powell responded to the Trump administration’s threat of criminal charges by describing the move as a “pretext” aimed at pressuring the central bank to cut interest rates.

In a statement, Powell, whose term ends in May, said that “this unprecedented action must be viewed in the broader context of ongoing threats and sustained pressure from the administration.”

Economists said the developments mark a dramatic escalation in the conflict between Powell and Trump, which dates back to Powell’s early years as Fed chair starting in 2018.

Andrew Lilley, chief interest rate strategist at Barinque Investment Bank in Sydney, said: “Trump is pulling at the remaining threads of central bank independence.”

He added: “Investors won’t welcome this, but it actually shows that Trump has few tools left to apply pressure. Interest rates will remain where the majority of Federal Open Market Committee members want them.”

The dollar was the biggest loser, falling even against currencies that typically weaken during periods of risk, such as the Australian and New Zealand dollars. The Dollar Index slipped 0.4% in European trading, on track for its largest daily decline since mid-December.

The dollar ended 2025 on a weak footing, down more than 9% against major currencies, reflecting narrower interest rate differentials following Federal Reserve rate cuts, alongside growing concerns over the US fiscal deficit and political uncertainty.

Ray Attrill, head of currency strategy at National Australia Bank, said: “This open war between the Federal Reserve and the US administration certainly does not paint a positive picture for the US dollar.”