Platinum breaks through $1978 to reach a 17-year high! Three major drivers for breaking through $2000 in 2026

The precious metals market is quietly undergoing a transformation. On December 18, platinum rose over 3%, reaching $1978 per ounce, marking six consecutive days of gains and hitting a new high since the 2008 financial crisis. More notably, from early 2025 to now, platinum has gained nearly 120%, far outpacing the gains of gold and silver. What market logic is hidden behind this?

South African Mineral Crisis Causes Global Supply Disruption

The lifeline of global platinum supply is in South Africa, which accounts for over 70% of the world’s production. However, South Africa is facing multiple challenges—aging mines gradually declining, persistent power shortages, and frequent extreme weather attacks. These factors compound, directly leading to a decrease in output.

How is the tightness of supply assessed? The market has already given an answer—recently, the one-month lease rate for platinum soared to a historic high of 14.12%. Edward Sterck, research director at the World Platinum Investment Council, bluntly stated that the global platinum market is facing a supply deficit for the third consecutive year, and this gap may continue until 2029.

Funds Shift from High-Price Gold to Undervalued Platinum

After the Federal Reserve’s rate cut policy took effect, the entire precious metals sector responded, but the rally showed clear differentiation—platinum and palladium surged far more than gold and silver. The logic is straightforward: some institutional funds withdrew from gold positions at historic highs and flowed into the undervalued, more volatile platinum sector, creating a clear capital spillover effect.

A weakening dollar, dovish Fed stance, and declining gold-to-platinum ratio all provide solid macroeconomic support for platinum prices.

Analysts Are Bullish: Target Price of $2170-2300 by 2026

FXEmpire analyst Muhammad Umair believes platinum has entered a new bull cycle. Structural supply shortages, rising industrial demand, and capital outflows from overvalued assets will combine to drive platinum’s momentum. He predicts that by 2026, platinum will reach a price range of $2170-2300, implying over 10% upside.

Deutsche Bank’s outlook further confirms this optimistic attitude. The bank expects platinum investment demand to rebound to 500,000 ounces in 2026, with supply-demand imbalance accounting for 13% of total supply, similar to the past two years. More importantly, Deutsche Bank believes gold will continue to strengthen in 2026, with silver and platinum group metals following suit, forming an overall upward trend in precious metals.

Under the dual forces of supply bottlenecks that are difficult to resolve quickly and a macro environment that continues to support, the platinum bull market story is far from over.