Palladium climbs off four-month low as dollar declines

Palladium prices rose over one percent in American trade away from October 25 lows for the fifth straight session as the dollar index bounced off January 23 highs, following earlier data from the US, the world's largest economy. 

As of 02:37 GMT, palladium rose 1.13% to $1,015.20 an ounce from the opening of $1,003.84, while the dollar index fell 0.41% to 88.75 from the opening of 89.12, marking February 1 lows. 

Earlier US data showed producer prices rose 0.4% in line with expectations in January, compared to a 0.1% dip in December, while core prices rose 0.4%, compared to a 0.1% slip, and beating expectations of a 0.2% increase. 

Unemployment claims rose 7 thousand to 230 thousand from 223 thousand in the previous reading, above expectations of 229K, while the Philly manufacturing index rose to 25.8 from 22.2 in January, beating forecasts of 21.5. 

The Empire State Manufacturing Index fell to 13.1 in February from 17.7 in January, while industrial production fell 0.1% in January, compared to a 0.4% rise in December, revised from a 0.9% increase, while analysts expected a 0.2% rise. 

The Capacity Utilization Rate fell to 77.5% from 77.7% in December, revised from 77.9%, and missing expectations of 78.0%. 

Palladium, one of the rarest metals on earth - 30 times rarer than gold- managed to reverse the march away from record highs as dollar gave up ground, while noting that Russia and South Africa provide over 75% of global palladium supplies. 

Otherwise, Standard Chartered recently projected a supply deficit of 563 thousand ounces in the palladium market this year, compared to a deficit of 459 thousand in 2016, while expecting upbeat gains throughout the ongoing 12 months, which was reflected in palladium's surge to record highs recently.