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Waning appetite for EVs could be lifeline for PGMS-

analyst

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Yields, dollar fall after Powell comments

(Rewrites as of 1542 GMT)

By Anjana Anil

March 6 (Reuters) - Gold rallied to a fresh record on

Wednesday, building on stellar momentum driven mostly by bets

for U.S. monetary easing, while autocatalyst palladium popped

back above the $1,000 mark for the first time since Jan. 12.

Spot gold gained 0.6% to $2,139.39 per ounce as of

1542 GMT after hitting an all-time high of $2,148.99 earlier in

the session. U.S. gold futures rose 0.3% to $2,147.60.

Silver added 1.2% to $23.97.

On Wednesday, gold got an additional fillip as the

dollar fell after Fed Chair Jerome Powell indicated a rate cut

later this year.

Gold suffers when high U.S. interest rates raise returns on

competing assets such as bonds and boost the dollar, making the

bullion costlier to buy with foreign currencies.,

"There's definitely been macro data that's pushed us in

this direction and the follow on to policy expectations from the

Fed... but the response in the gold market has been multiples of

what long-term fair value models suggest," said Michael Hsueh,

FX & Commodities Strategy analyst at Deutsche Bank.

Traders now see a 70% chance for a June Fed rate cut.

"CTAs are now firing long on all cylinders in gold, with

funds holding roughly 80% of their historic max long position,"

Ryan McKay, senior commodity strategist at TD Securities, said

in a note.

Platinum rose 2.4% to $901.85 per ounce, while

palladium gained over 10% to $1,042.83.

Palladium seems to have attracted another round of 'big

buying" from funds, with some of it very technical, said Bart

Melek, head of commodity strategies at TD Securities.

Waning appetite for EVs might be a bit of a lifeline as

well, Melek added.

The auto sector accounts for 80% of the demand for

palladium, which fell 39% in 2023 due to its replacement with

cheaper platinum in autocatalysts, curbing emissions and rising

market share of electric vehicles.