Metals shine in 2025’s first half: Platinum, palladium and gold lead the charge

Precious metals align with Islamic principles as tangible assets, free from riba, preserving real value against inflation and geopolitical risk. Gold, in particular, qualifies for zakat, and platinum can follow this tradition.

By MOGAMAT ALI SALIE

IN the first two quarters of 2025, precious metals have emerged as standout performers in a volatile global economy.

For readers of Muslim Views, this offers hope and opportunity – moments to contemplate ethical wealth preservation and investment aligned with Islamic values.

Precious metal stars

1. Platinum – The champion (+40–50 percent)

Platinum has truly stolen the spotlight, rallying between 40 percent to 50 percent year-to- date. In Q2 alone, it surged 36 percent, reaching a near 11-year high of around $1,430 per ounce. A perfect storm of factors fuelled this:

• Structural supply deficits – ongoing market shortfalls (around 966 koz in 2025), driven by mining challenges in South Africa and Zimbabwe.
• Strong Chinese demand – from jewellery, industrial uses, and renewed investment interest.
• Geopolitical jitters – US trade tensions and tariff fears prompted speculative stockpiling.

2. Palladium – Steady and surging (+22 percent)

Palladium also shone, gaining about 21–22 percent in H1 2025, including a 10.6 percent rise in Q2. Technical reversals boosted momentum, and revitalized auto sector demand served as its backbone.

3. Gold – The everlasting safe haven (+25 percent)

Gold continued its steady ascent, up 25–26 percent YTD, with a 6 percent gain in Q2. It hit fresh highs for the seventh straight quarter, buoyed by macroeconomic uncertainty, trade tensions, and inflation fears.

A mixed bag

In contrast, several commodity sectors lagged behind:

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• Energy and agriculture commodities: Oversupply in oil, LNG, and grains weighed heavily. Crude prices slipped around 20 percent in Q2, while grains and soft commodities declined ~5–6 percent.
• Industrial metals: Copper and similar metals faced headwinds from US tariff fears and cooled Chinese demand.

Drivers behind the shift

1. Global supply constraints

Mining disruptions – particularly widespread flooding in South Africa, refinery shutdowns, and restructuring in North America – crippled platinum supply, while recycling couldn’t close the gap. This led to consecutive annual deficits since 2023.

2. Chinese demand and jewellery Trends

Jewellery demand pivoted sharply toward platinum, especially in China and Japan. Platinum jewellery surged: +26 percent in Q1, with gold declining –32 percent in China . This ‘gold fatigue’ reflects both cost-effectiveness and trend shifts.

3. Trade and Tariff Dynamics

Anticipation of US tariffs triggered speculative metal buying – storing platinum in NYMEX warehouses and US stockpiling. These moves intensified metal tightness and pricing.

4. Macroeconomic and geopolitical instability

Persistent global uncertainties – US-China tensions, Mid-East conflicts, and inflation worries – have heightened demand for safe-haven assets. Gold and palladium benefited; so did platinum, riding both investment and industrial waves.

Why this matters to Muslim investors

• Ethical wealth protection: Precious metals align with Islamic principles as tangible assets, free from riba, preserving real value against inflation and geopolitical risk. Gold, in particular, qualifies for zakat, and platinum can follow this tradition.
• Economic justice and local ties: Supporting platinum – such a key South African export – can help local Muslim communities by creating jobs and promoting halal-aligned value chains in mining and jewellery
• Balanced portfolios: With underperformance in energy and grains, diversifying into precious metals offers stability and resilience grounded in faith and prudence.

Takeaways

1. Embrace secular yet principled diversification: Investors may allocate a portion of investment into gold, platinum, and palladium through shariah-compliant Exchange Traded Funds (ETFs) or physical assets.
2. Focus on ethical extraction: Investors may advocate for investments in mining operations in South Africa that follow environmental, social, and Islamic governance standards.
3. Monitor macro and industrial adoption trends: Platinum’s path hinges on industrial uses and luxury consumer choices. Investors should stay attuned to Chinese sector dynamics.
4. Prepare for volatility: The World Bank forecasts a downward drift in broader commodity prices this year, but precious metals are projected to stay strong.

Final reflections

The first half of 2025 tells a powerful story: a clear preference for metal-backed, real-value assets amid global uncertainty. Platinum’s dramatic rise is a market signal – and an ethical opportunity – for Muslim investors to steward wealth responsibly and support sustainable industry within the Ummah.

As Muslim Views readers, this is a moment to reflect – on our investment strategies, our contributions to local economies, and our resilience in times of global flux. Precious metals aren’t just commodities – they can be cornerstones of trust, stability, and faith-driven finance.

Mogamat Ali Salie Co-Founder of MuslimFin, a fintech business that is specifically focused on educating and directing Muslims and non-Muslims on Shariah-compliant finance. For more information visit muslimfin.com