The weak dollar policies of the Federal Reserve under Chairman Ben Bernanke have vitiated the traditional correlation between ETFS Physical Platinum Shares (NYSEARCA:PPLT), and SPDR Gold Shares (NYSEARCA:GLD). While a ghost of the traditional relationship remains, excessive liquidity has forced gold and platinum apart.
Since August 2010, the falling U.S. dollar has led to excessive speculation in commodities. Gold, silver, oil, platinum and other commodities rose based not on fundamental economic demand, but on speculative buying. Those purchasing were looking at the next move of the Federal Reserve rather than demand from traditional industrial end users.
As a result of this, gold and platinum have diverged, along with other correlations in commodities.
The ETFS Physical Platinum Shares is currently up for the week, month and quarter, but down 5.25% for the year. By contrast, SPDR Gold Shares is down for the week, month and quarter, but up 19.43% for the year.
It's notable that gold's fall has come when many were betting on the announcement of another round of quantitative easing by the Fed, which has yet to come.