Bank of America Securities has sharply raised its 2026 price forecasts for platinum group metals. The bank sees trade dislocations, constrained supply, and renewed investor interest as bullish catalysts.
On Friday, January 9, the bank’s analysts lifted the 2026 platinum forecast to $2,450 an ounce from $1,825, and the palladium forecast to $1,725 an ounce from $1,525. In a way, it was moving the goalposts, as spot prices have already surged beyond $2,440 for platinum and $1,825 for palladium.
“We continue to expect platinum to outperform palladium, underpinned by persistent market deficits,” the bank said, adding that any supply response is likely to be slow due to “production discipline and inelastic mine supply.”
What is different this time is the growing impact of tariffs and trade risk. U.S. trade investigations have tightened physical availability and distorted flows, particularly for palladium. The bank noted the unresolved risk that duties would drive inventories higher on U.S. exchanges and sharply increase exchange-for-physical premiums.
Nine Times Below ‘Fair’
Palladium has been especially sensitive, as markets price in the possibility of punitive tariffs on Russian material. The U.S. Department of Commerce has estimated a dumping margin of roughly 828% on unwrought Russian palladium – meaning the Russian palladium is being sold in the U.S. at a price nearly nine times lower than what is considered “fair.” If translated into duties, this figure could dramatically lift domestic prices, given Russia’s dominance in global supply.
Supply constraints have compounded the rally. Russia’s key producer, Norilsk Nickel, saw lower output owing to equipment transition and changes in ore composition. Thus, in the first nine months of 2025, platinum and palladium production fell by 7% and 6%, respectively. This near-term shortfall has tightened the global market, although Bank of America expects Russian output to recover.
Meanwhile, China has emerged as another key factor. A rebound in jewellery demand, combined with record gold prices, has encouraged substitution into platinum. Bank of America estimates that just a 1% shift in gold jewellery demand could widen the platinum deficit by nearly one million ounces, or about 10% of global supply.
At the same time, the launch of physically backed platinum and palladium futures on the Guangzhou Futures Exchange has pulled additional metal into China, with palladium imports quadrupling since September.
Mean Reversion Risk
Still, not everyone is convinced that the rally continues. Precious metals service provider Heraeus warned that platinum prices look stretched after ending December more than 44% above their 200-day moving average.
“That threat still hangs over palladium and platinum with the U.S. government’s Section 232 and Russian anti-dumping investigations yet to report,” Heraeus said, according to Mining Weekly.
However, the firm pointed out the mean-reversion effect following such rallies. Historically, on seven occasions when platinum traded more than 20% above its 200-day average, prices later corrected by 10% to 20%.
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