Platinum has taken a painful blow after the Volkswagen scandal,
says Edward Meir, commodities analyst with INTL FCStone.
On Tuesday nearby
platinum futures tumbled more than $35 an ounce, then dropped to
an $925.80 an ounce overnight - its weakest level since early 2009,
before stabilizing.
There are worries in the marketplace that news reports
about falsification of U.S. vehicle-emissions tests will dissuade consumers from choosing diesel engines, "especially those who
are more environmentally conscious,” Meir says.
Platinum is needed
for catalysts in diesel-powered vehicles, while gasoline-powered cars
can use less-expensive palladium.
Volkswagen said that 11 million of its cars worldwide were potentially impacted and that the company will set aside €6.5bn to cover the costs of the investigation into how its diesel cars cheated emission tests, sending its shares slumping.
