By Glenys Sim
March 4 (Bloomberg) -- Platinum dropped for a third day, trading near a three-week low, as slumping demand from the auto industry cut demand for the metal that’s used mainly to make catalytic converters. Gold extended declines.
Toyota Motor Corp., the world’s biggest carmaker, suffered a record drop in U.S. sales last month as the recession cut demand, according to a company statement. Honda Motor Co., Japan’s second-largest carmaker, had a 38 percent drop and Nissan Motor Co.’s sales fell 37 percent.
“Demand for platinum-group metals from automakers might remain lethargic,” Walter de Wet, an analyst at Standard Bank Ltd., wrote in an e-mail.
Platinum for immediate delivery fell as much as 0.4 percent to $1,029.50 an ounce, and traded at $1,033 at 10:08 a.m. Singapore time. The metal dropped to as low as $1,028.25 yesterday, the lowest since Feb. 10. Palladium lost 0.3 percent to $193.50 an ounce.
Toyota has turned to Japan’s government to borrow money for U.S. car loans as private investors demand as much as 50 percent more in interest for the company’s debt. Honda may do the same. General Motors Corp. and Chrysler LLC are surviving on $17.4 billion in U.S. government loans.
Gold declined for a eighth straight day as “investor enthusiasm waned,” said David Moore, chief commodity strategist at Commonwealth Bank of Australia.
Gold for immediate delivery fell as much as 0.6 percent to $910.42 an ounce, before trading at $914.40 at 10:11 a.m. in Singapore. Silver dropped 0.3 percent at $12.785 an ounce.
Holdings in the SPDR Gold Trust, the biggest such fund backed by bullion, remained at a record 1,029.29 metric tons for a fourth day yesterday. Holdings in ETF Securities Ltd.’s Physical Gold exchange-traded fund fell to 2.37 million ounces from 2.377 million ounces two days ago.
To contact the reporter on this story: Glenys Sim in Singapore at gsim4@bloomberg.net
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