Gold Price 2025: A Renaissance of the Underestimated Precious Metal?

Precious Metals on the Rise – Is Platinum in the Shadow?

The global precious metals markets are showing remarkable dynamics in 2025. Gold is trading above the $3,300 mark per ounce, and silver has surpassed the $38 threshold. However, while these two metals regularly make headlines, platinum remains unfamiliar to many investors – despite offering fascinating opportunities as an investment metal. The question arises: why is platinum so significantly lagging behind its valuable brother gold?

The counterintuitive movements: platinum price versus gold price

Historically, platinum was long considered the king among precious metals. In 2014, platinum prices were still well above gold, trading over $1,500 per ounce. A dramatic turning point followed: while gold has been steadily reaching new all-time highs since 2019 – recently surpassing $3,500 in April 2025 – the platinum market stagnated for years.

In early 2020, platinum even fell below the $600 mark, an unprecedented weakness for such a rare element. The subsequent five years saw only price fluctuations around $1,000. But since the beginning of 2025, a transformation has occurred: platinum prices jumped from just under $900 in January to about $1,450 in July – an increase of over 50% in just six months.

Why is platinum rarer but cheaper than gold?

The answer lies in the duality of platinum: it is not only an investment asset but also a consumable good. This characteristic explains both the opportunities and the volatility.

Gold primarily functions as an inflation hedge and store of value. Its role in industry is marginal. In contrast, platinum faces supply pressure from two sides: investors buy it up, while industry consumes it continuously. The industrial added value is significant – platinum is used in catalysts for diesel vehicles, medical implants, high-performance lubricants in chemistry, and increasingly in green technologies such as fuel cells and hydrogen production.

This diverse application makes platinum interesting for the future but also leads to price distortions. The weakness of the automotive industry – especially in diesel vehicles – suppressed demand and thus prices for years. The platinum-gold ratio has been negative since 2011, marking the longest undervaluation phase in the modern price history of both metals.

The historical perspective: from rarity to industrial solution

Platinum’s entry as an investment asset is surprisingly recent. While gold and silver have been minted since antiquity, platinum only appeared on the coin market in the 19th century – initially only in Russia. In 1845, an export ban followed, leading to overproduction and a price crash. Only with growing industrial demand in the 20th century did prices recover.

A milestone: in 1902, the Ostwald process for nitric acid production was patented, revolutionizing platinum use in the automotive industry. The price skyrocketed to six times the gold price by 1924. Crises slowed development, but from 2000 onward, platinum embarked on a spectacular run, culminating in March 2008 at $2,273 per ounce – driven by fears of financial crises and explosive industrial demand.

The last 15 years have been chaotic: oil price declines, diesel scandal, electrified mobility – all weighed heavily on the platinum market. Only now is a turnaround emerging.

What is driving the current rally? The perfect market storm 2025

The 50%-jump since the start of the year results from a combination of several factors:

Supply side:

• Critical production sites in South Africa
• Structural deficit: demand exceeds supply by at least 539,000 ounces in 2025
• Extreme physical scarcity, evident in historically high lease rates
• Recycling is growing only slowly

Demand side:

• Surprisingly robust demand from China in the jewelry sector
• Investment flows into platinum ETFs are significantly increasing
• Automotive demand remains stable despite pessimism

Macro factors:

• Weak US dollar makes foreign buyers more aggressive
• Geopolitical tensions promote security thinking (Resource Security)
• Long-term hopes for a green hydrogen economy

Market expectations for 2025 and beyond

The World Platinum Investment Council forecasts total demand of 7,863,000 ounces in 2025 against only 7,324,000 ounces of supply – resulting in a deficit of 539,000 ounces.

Demand distribution 2025:

• Automotive industry: 41% (3.245.000 koz), +2% compared to 2024
• Industry: 28% (2.216.000 koz), -9% (Main brake)
• Jewelry: 25% (1.983.000 koz), +2%
• Investments: 6% (420.000 koz), +7%

Total demand declines by 1%, reflecting industry weakness. But this is where the optionality lies: if Chinese or American industrial production grows more strongly than expected, platinum could become significantly more expensive. US-China trade relations will be a decisive factor.

Supply scenario: A very modest supply growth of only 1% is structurally driven. South African mines cannot be ramped up quickly. Recycling could grow by up to 12% in 2025 and will be critical in the medium term. The structural deficit will persist until 2029.

Platinum versus gold: a reevaluation?

Gold functions purely as a store of value – independent of economic cycles and industrial production. Platinum experiences dual dynamics: as a raw material, it benefits from economic booms; as a rare metal, it benefits from uncertainty. This schizophrenia explains the volatility and also why long-term investors accumulate platinum during recessions.

Future platinum use will focus increasingly on three areas: (1) Hydrogen economy and fuel cell production – where platinum has no equivalent, (2) specialized medicine and high-tech materials, (3) and paradoxically, catalysis in combustion engines, which last longer than many expect. These diversified applications make platinum less inflationary than pure gold savings but more volatile.

And yet: platinum is massively undervalued. It is physically rarer than gold, has more technical uses, and is still cheaper. This is an anomaly that could resolve itself – or not, if structural problems in industry persist.

Investment scenarios: who is platinum suitable for?

For active traders: The volatility of platinum offers attractive trading setups. CFD trading with leverage allows profiting from price fluctuations with moderate capital. A proven strategy is trend following with moving averages (e.g., 10 and 30 MA): when the fast crosses above the slow from below, a long position opens; when it crosses below, it closes.

Risk management is central:

• Risk only 1-2% of total capital per trade
• Set stop-loss (e.g., 2% below entry price)
• With €10,000 total capital and 1% risk per trade, leveraged positions should not exceed €1,000 (with 5x leverage)

For conservative portfolios: Platinum as a 5-15% allocation can serve as a long-term hedge, especially against US stock declines. The supply/demand dynamics are independent of stock markets, creating diversification effects. Platinum ETFs, physical platinum, or mining stocks are options. Regular rebalancing and combining with other precious metals reduce volatility risks.

Outlook: consolidation or new highs?

The mid-July 2025 update warns of a consolidation phase. After the extreme price jump, there is an increased risk of profit-taking. The further drivers are:

• US dollar trend: a weaker dollar supports platinum, a stronger one suppresses it
• Demand stability: US tariffs and protectionist trade policies threaten the assumed industrial demand
• Supply recovery: despite the structural deficit until 2029, South Africa could unexpectedly ramp up capacities
• Lease rate signals: extreme lease rates indicate market tension – normalization would be a bearish signal

The platinum story of 2025 is far from over. A rare, versatile metal that has long been underestimated could reclaim its rightful place – or it could fall back into obscurity. Both the risk and the opportunity are real.