German technology group Heraeus finds in its latest precious metals appraisal that gold continues to enjoy strong support from institutional investors amid price increases invoked by uncertainty on tariff changes likely to be implemented by the US.

The company reports that US President Donald Trump’s 25% tariff on automotive imports into the US helped push spot gold to an all-time high price of $3 087/oz last week.

Gold exchange-traded fund (ETF) inflows have also been strong over the last month, with ETFs having added 23 t of gold on March 21, marking the biggest one-day increase since 2022.

Over the first quarter of this year, gold-backed ETFs have seen net inflows of 152 t so far, lifting the total to the highest since September 2023. However, global gold ETFs are some way off the previous high in November 2020 when the gold price was below $1 900/oz.

While lower in terms of physical allocation, the estimated assets under management of global gold-backed funds are currently at all-time highs. As of March 28, the value of total global holdings was equal to $268-billion.

Continued inflows into gold-backed ETFs could continue to support the gold price and, though it is above $3 000/oz, investors may be on the look-out for profit-taking opportunities to cash out gains made over the last 18 months.

Notably, China’s central bank has slowed its gold purchases, having added 16 000 oz in February, compared with an average volume of monthly gold purchase of 59 000 oz between November 2022 and March 2024.

The reduction is not necessarily related to the current price level. However, central bank demand has been supporting demand for gold over the last 24 months, and a reduction could see some of that support reduce.

Heraeus finds silver to have been the outperformer among the precious metals in the first quarter of the year, having recorded a 17.9% increase in pricing, which outpaced gold’s price increase in terms of percentage.

Last week alone, silver prices rose by 3% to reach a high of $34.59/oz.

Silver-backed ETF holdings have, however, only increased by 0.32%, or 2.2-million ounces, since the start of the year, compared with a 5.9% increase in total ETF gold holdings over the same period.

The platinum price was volatile last week, swinging more than $20/oz in one day, but remained largely unchanged on a weekly basis at $985/oz. Heraeus says platinum demand in China is dwindling in some respects as the country replaces internal combustion engine-powered buses with fully electric buses.

However, the company adds that total Chinese heavy-duty platinum autocatalyst demand is forecast to grow by 8% year-on-year to 170 000 oz this year owing to a recovery in heavy-duty truck production after a year of depressed demand in the country.

Palladium prices will also be impacted on by lower demand as US automotive imports are likely to crimp new-vehicle production and sales. The palladium price averaged $976/oz last week.

In 2024, the US imported more than eight-million new light vehicles. Pre-tariff North American automotive palladium demand was forecast to total 1.6-million ounces this year; however, if cars become more expensive, or simply are not available in the market, it risks an oversupply of palladium.

Moreover, rhodium, ruthenium and iridium prices remain stable at $6 100/oz, $670/oz and $4 850/oz, respectively. These metals are poised to benefit from green hydrogen investments in Western Australia; however, the outlook for green hydrogen and associated platinum group metal (PGM) demand is mixed this year.

There have been a number of significant proton exchange membrane-based electrolyser project announcements in China and India, where non-PGM-based alkaline technology has historically been much more widespread.

Iridium hydrogen demand is still small compared to other demand areas and may struggle to see growth this year, given the market challenges. However, there remains potential for significant demand growth in the future.