Spot palladium fell 10.6% to $2,122.21 an ounce, after hitting its lowest level since March 29 at $2,068.82.
Commodities generally fell as Concerns were growing over the prolonged lockdowns in Shanghai and possible interest rate hikes by the Federal Reserve that would hurt global growth and demand.
The metal, used in vehicle exhaust to reduce emissions, has fallen nearly 40% since hitting an all-time high in early March. on concerns that the war in Ukraine could cut supply from key producer Russia.
“Much of the angst in palladium is related to potential problems with the Chinese economy,” said Bart Melek, head of commodity strategies at TD Securities.
Meanwhile, spot gold fell 1.8% to $1,895.36 per ounce, while the US gold futures were down 1.9% at $1,896.90.
“It seems that fears about rate hikes have prevailed lately,” said Julius Baer analyst Carsten Menke. “We would think that inflationary pressures are about to subside and that should remove some of the safe-haven demand for gold.”he added.
Although bullion is seen as a hedge against skyrocketing inflation and uncertainties such as the war in Ukraine, rising interest rates reduce their attractiveness by increasing the opportunity cost of holding the non-interest bearing asset.
The dollar hit a two-year high, making gold more expensive for holders of other currencies.
Among other precious metals, platinum fell 1.9% to $913.17, after hitting a low since December 2021. Silver fell 2.7% to $23.49 an ounce, after trading at a low of more than two months.
Oil plummets more than 6%
The Crude fell more than 6% on Monday, hitting a nearly two-week low, amid heightened concerns over prolonged COVID-19 lockdowns in Shanghai. and possible interest rate hikes in the United States, which could hurt global growth and oil demand.
Brent crude fell 5.9% to $99.90 a barrel, hovering around its lowest since April 12. The West Texas Intermediate in the United States (WTI) fell 5.8% to 96.14 dollars.
Crude oil also weakened on the prospect of higher interest rates in the United States, which is boosting the dollar. A strong US currency makes greenback-priced commodities more expensive for holders of other currencies and tends to reflect greater risk aversion among investors.
Source: Ambito
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