Gold 0.21%
£3,393.46 OZ
Silver -2.37%
£52.00 OZ
Platinum -0.49%
£1,356.40 OZ
The Silver Britannia is capital gains tax free in the UK, making is a very popular choice with UK investors
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The platinum-to-gold ratio has undergone significant fluctuations over the years, influenced by supply disruptions, financial crises, and industrial demand shifts.
Historically, platinum traded at a premium to gold, but this dynamic changed in the late 1990s and has not been restored since Platinum last traded above Gold in 2015.
This article explores the key events that have shaped the platinum-to-gold ratio, analysing the reasons behind its movements and its implications for the future.
A chart to show the Platinum to Gold ratio from 1985 through to 2025. The chart shows how many ounces of PLatinum a single ounce of Gold can buy and how this has changed over time
For over a decade, platinum maintained a higher value than gold. However, in December 1999, this premium broke down, and by February 2001, one ounce of gold was worth 0.419 ounces of platinum, the lowest level recorded in the time series. While platinum recovered some ground, it did not regain the dominance it had between 1986 and 1999 until Summer 2008. Platinum has been slowly losing ground against Gold since
In summer 2008, platinum saw its final opportunity to trade at a premium to gold, with 0.47 ounces of platinum buying one ounce of gold. However, as the financial crisis unfolded, platinum, which is heavily tied to industrial use, was hit hard. By December 16, 2008, gold and platinum reached parity for the first time since. This marked a fundamental shift in market perception, with investors preferring gold as a safe haven asset over platinum.
The financial crisis in 2008 changed the entire dynamics between Platinum and Gold because Gold has significantly outperformed Platinum since
Platinum prices made some gains after the 2008 crisis but failed to maintain momentum. The platinum-to-gold ratio hit 0.707 in March 2010, before declining again. By February 2012, the ratio had peaked at 1.153 ounces of platinum per gold ounce, reinforcing gold’s lead. In 2014, platinum had only traded at a discount to gold on four occasions in the previous forty years, each time rebounding strongly in the following year
However, this time really was different as since 2014 Platinum has continued to underperform Gold. The ratio stabilised between 0.8 and 0.9, before parity was reached again on January 15, 2015. This was the final time platinum traded higher than gold.
Despite persistent market deficits, platinum prices remained weak due to low investment demand and undisclosed vaulted stock sales. In 2014, South African mining strikes reduced supply significantly, yet this failed to boost platinum’s value relative to gold. A key issue was the decline of diesel vehicle sales following the Volkswagen emissions scandal, which reduced the need for platinum-based autocatalysts.
Between 2015 and 2019, platinum supply stabilized, but demand remained weak. The rising price of palladium encouraged some substitution of platinum in gasoline vehicle autocatalysts, but this was not enough to offset falling diesel demand.
In 2020, the COVID-19 pandemic triggered a surge in gold prices as investors sought safe-haven assets. The platinum-to-gold ratio widened dramatically, reaching 2.35 ounces of platinum per gold ounce at its peak. The forecast of industrial activity collapsing really hit the Platinum market hard whereas Gold saw strong capital flows, pushing the ratio over 2 for the very first time in history
By February 2025, the platinum-to-gold ratio had reached an all-time high of 3.1 ounces of platinum per Gold ounce. This represents the largest valuation gap in recorded history, reinforcing gold’s dominance and Platinum’s valuation.
In 2024 was AngloAmerican confirmed that the All-In Sustaining Cost (AISC) for producing platinum, palladium, and rhodium stood at US$986 per 3E ounce.
With platinum trading at roughly the same level, this signals that mining companies are operating at break-even levels with little to no profit margin. This underscores the challenges faced by platinum producers in a market where gold continues to outperform.
If an investor wanted to bet on the Platinum-to-Gold ratio normalising to 2:1 instead of the current 3:1. The following rotation trade is a potential strategy.
An investor selling 1 ounce of Gold to buy platinum at the current 3.1 ratio and then exchanged the platinum back for gold once the ratio returned to 2.1—they would gain an additional 0.485 ounces of gold for free.
This means they would end up with 1.485 ounces of gold instead of the original 1 ounce, effectively increasing their Gold holdings by 48.5% without paying a single penny.
Western sanctions on Russia could result in stronger Platinum demand due to Western nations moving away from Russian centric Palladium
As Russia accounts for almost 40% of global palladium supply but only 11% of global mined Platinum supply, switching Palladium to Platinum helps to avoid potential supply chain disruptions from sanctions
The Platinum spot price in 2025 is trading at prices that were seen back in 2014 against the US$. The price action has been flat notwithstanding some rangebound volatility. Why has Platinum prices not moved in over a decade? The answer is multifaceted but a large factor is how well balanced the market has been. Supply and demand have been very well balanced which has done little to encourage breakout of prices, resulting in a stagnant price
This is a situation that cannot be sustained forever as miners are seeing their costs increase with price inflation yet their revenues are flat. This will lead to mining supply stagnating and lack of investment in exploration and production. A big misconception for the Platinum market is that demand was impacted by tightening regulation of diesel vehicles, the chart above shows current 2025 forecast demand is as high as it was before the regulations came into effect
Other key factors that has led to Platinum prices lagging other commodities are summarised below:
Platinum prices have crashed during the 2008 financial crisis as well as the 2020 lockdown. This will be fresh in investor’s minds and will discourage many from investing as Platinum has demonstrated that it is not a safe haven asset
European media has repeated articles discussing the reduction in diesel automotives which was a large proportion of Platinum’s demand. Official data shows that automotive was 41% of total Platinum demand in 2014, 10-years later is was unchnaged at 40%. Overall Platinum demand is no lower now than it was a decade ago
Since the invasion of Ukraine in 2022, central banks have been buying Gold at a rapid pace. This has kept Gold demand artificially high despite record prices, whilst Platinum was not part of the buying programmes, hence why one of the assets has risen whilst the other was left grounded
Benign market price action does little to encourage fresh capital inflows. A lack of a trend has led to the typical investor over-looking Platinum as an investment theme. Lack of momentum or any sign of an uptrend has compounded the flat market
Investing in Platinum
The Royal Mint’s flagship Platinum bullion coin. The Platinum Britannia is capital gains tax free and looks fantastic in hand
