THE price of palladium rose sharply on the London precious metals market yesterday as dealers grew concerned over the suspension of supplies from Russia.
The metal was fixed at $392.00 an ounce yesterday afternoon, a new all-time high. Palladium's previous high fix was $390.00 an ounce on April 23. There have been no supplies of palladium from Russia, the world's largest supplier of the precious metal, this year.
Meanwhile, gold rose by $3 to more than $302 an ounce in early London dealing on worries that the civil unrest in Indonesia was out of control. Indonesia is both a producer and a big consumer of the yellow metal.
Although gold lost some ground in late trading, it stayed above $300 an ounce and dealers were bullish. ''There is a strong possibility that we will go to the highs very quickly. Gold has turned round, it's actually wrong-footed a few people and overall it is looking quite good,'' one London dealer said.
Sentiment was affected by an announcement by Indonesian gold miner Aurora Gold that it had halted shipments of gold from its Mount Muro mine in East Kalimantan province due to riots in Jakarta. Dealers said the bullion market would not be affected by the news because the mine was not a big producer but sentiment may be affected.
''The fact that one of the mining concerns opted for force majeure they have got in their contract, it is only one mine and that would not turn this market around. It is far more fundamental than that.
Gold found its support level, confirmed it and it has found good buying from a couple of institutions overnight,'' the dealer said.
Indonesia accounts for about half of gold production in Asia.
Another metals trader said the Indonesian unrest coupled with the effect of sanctions imposed on India - the world's largest consumer of gold - over its nuclear tests this week, will have more of a psychological effect on the bullion market.
Brokers GNI in London said in a report that gold appeared to jump on the Aurora news.
Silver was steady at around $5.67 an ounce after rising earlier this week.
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