TOKYO -- Platinum prices have been trailing gold prices since mid-January, with the gap having widened to about $90.
The benchmark futures contracts for gold traded at about $1,180 per troy ounce during off-hours trading Tuesday. Meanwhile, the price for platinum stood at about $1,090.
Given the difference in production volume, platinum is usually pricier -- platinum output is 200 tons per year, less than one-fifteenth that of gold. But the traditional dynamic has been turned on its head. Something similar happened in 2013.
Since the start of the year, gold has tread water while platinum has fallen 9% to its lowest level since January 2013.
Platinum is used as a catalyst in the exhaust systems of diesel cars in Europe. With the Greek crisis shaking up Europe, a major consumer of platinum, some are beginning to worry about a demand drop-off.
Meanwhile, in South Africa, which accounts for some 70% of the world's platinum output, producers are not slowing down operations because of the weak local currency. An official from Impala Platinum says the mining company is ramping up output.
Platinum touched a six-year low on the New York futures market Monday. Hiroyuki Kikukawa, chief analyst at Nihon Unicom, expects the price to stay low for a while. Gold, on the other hand, is stuck in the upper $1,100 range. With the price having dropped to a relatively low level, store purchases are picking up in China and India.
With gold considered a safe asset, Russian buying is active amid the decline of the ruble. Russia's central bank is buying gold from domestic mines, indirectly propping up the gold market, said Koichiro Kamei, a precious-metals analyst.
Greece's central bank, with the risk of default overhead, is also gradually adding to its gold holdings. Greece has stepped up purchases since May 2011, when the euro started declining. The country is trying to build up creditworthiness by buying gold, in order to be prepared to revive its former currency, the drachma, if it is expelled from the euro, says Kamei.
Gold accounts for 65.7% of Greece's foreign-currency reserves. Only nine countries -- such as the U.S. and Germany -- have a percentage above 60%. Japan's is only 2.3%.