September 30, 2015 / 4:12 AM / 4 years ago

PRECIOUS-Platinum poised for worst quarter in seven years on VW scandal

* Platinum prices near lowest since Dec. 2008
    * Metal poised for 15 pct drop in Q3
    * Gold headed for worst quarter in a year

 (Updates prices)
    By A. Ananthalakshmi
    SINGAPORE, Sept 30 (Reuters) - Platinum edged up on some
bargain hunting on Wednesday but was still near its lowest since
December 2008 and looked set to post its biggest quarterly slump
in seven years on fears of a demand fallout from the Volkswagen
emissions scandal.  
    Gold extended losses to a fourth day and was headed for its
worst quarter in a year on a looming U.S. rate hike. 
    Platinum has been hit after revelations that Volkswagen AG
 falsified U.S. vehicle emission tests, which some
believe could affect demand for diesel cars. Platinum is widely
used in auto catalysts, particularly for diesel engines.
 
    The metal's 15 percent loss this quarter is its fifth
straight quarterly drop and its worst three-month period since
the third quarter of 2008. It is down 9 percent for the month,
its biggest monthly drop since May 2012.
    Spot platinum edged up 0.4 percent to $916.95 an
ounce by 0641 GMT, not too far from a 6-1/2-year low of $894
reached in the previous session.
    "There is some bargain hunting for platinum but it is not
very sustained," said a trader in Tokyo, adding that investment
demand for platinum has seen a pick up in recent days with the
price slump.
    "Sentiment is very bearish and I think we could break below
$900 again."
    Even before the Volkswagen scandal broke last week, the
platinum market had been suffering from an increase in supplies
following the end of last year's five-month strike among
platinum miners in major producer South Africa, and a weakness
in Chinese jewellery demand.
    Palladium, on the other hand, has gained as investors
believe demand for gasoline cars could increase. With a 10
percent jump, the metal was poised to log its best month since
July 2013, though it was still headed for a quarterly loss.
    Spot gold fell 0.2 percent to $1,124.81. 
    With a drop of 4 percent, the yellow metal was headed for
its worst quarter in a year, hurt by expectations that the
Federal Reserve would raise U.S. rates this year for the first
time in nearly a decade and reduce demand for
non-interest-paying bullion.
    Traders will be eyeing a speech by Fed Chair Janet Yellen
later on Wednesday and a private employment report for clues
about the economy and timing of a rate hike. 
    The metal failed to see safe-haven bids despite a drop Asian
stocks to three-year lows on Tuesday and concerns over the
Chinese economy.
    Gold could see more losses this week as top consumer China
heads for a week-long holiday from Thursday, removing a key
support for prices during Asian trading hours.
    
    PRICES AT 0641 GMT    
 Metal            Last     Change   Pct chg
                                           
 Spot gold        1124.81    -2.25     -0.2
 Spot silver       14.575   -0.035    -0.24
 Spot platinum     916.95      3.2     0.35
 Spot palladium    660.35     6.35     0.97
 Comex gold        1124.4     -2.4    -0.21
 Comex silver       14.59    0.017     0.12
 Euro              1.1231                  
 DXY               96.022                  
                                           
 COMEX gold and silver contracts show the
 most active months
 
 
 (Reporting by A. Ananthalakshmi; Editing by Anand Basu)
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