By Bharat Gautam

(Reuters] – Palladium fell nearly 17% following a rally to an all time high due to the Ukraine crisis. The sharp correction came as fears eased about the possibility that Russia might cut supplies of the autocatalyst metallic.

A nearly 2 percent decline in gold was also caused by progress in Russia-Ukraine talks.

The price of palladium (used in engine exhausts in cars to reduce emission) fell to $1,433.35/ounce at 1533 GMT. It was experiencing its highest daily percentage fall in over two years. The session saw it fall as high as 16.8% earlier.

Platinum fell 3.2%, to $1.044.79.

Russian mining giant Nornickel’s GMKN.MM largest shareholder said to Russian RBC TV, that the group was able to find alternative routes for palladium deliveries despite logistical challenges. (Full Story)

Edward Moya is a senior analyst with OANDA. He stated, “There has been a sudden shift in expectations that exports might not suffer much disruption and that we may start seeing some demand destruction to the chip sector as well as auto manufacturers.”

Moya said that expectations of a peak in palladium could be behind this sell-off. Prices are likely to stay volatile for the short term.

Graphic: Palladiums slumps after record rally: https://fingfx.thomsonreuters.com/gfx/mkt/myvmnxlkmpr/PalladiumFreefall.png

Stock markets rose despite a waning appetite for safe-haven assets like gold and tentative optimism about progress in Russia-Ukraine talks. MKTS/GLOB (Full Story) (Full Story)

The XAU= dropped 1.5% to $1954.96 an ounce while the U.S.GCv1 declined 1.3% to $1959.00. Silver fell 2.4% to $25.18.

Markets are showing a cautious mood, but “I would not call this the recent peak in gold” because it is too early to tell. Carsten Menke, Julius Baer Analyst said that it’s still fluid.

Menke stated that short-term speculative traders, who have bought gold as a result of war, may make profits.

Non-yielding bullion was also under pressure. Benchmark rose as the Federal Reserve expected to increase interest rates this week.