LONDON, Feb 15: Platinum rose more than 1 per cent on Friday to trade just below record highs above $2,000 an ounce as investors bet on strong prices due to output losses in top producer South Africa.

Spot metal hit a high of $2,024 an ounce and was quoted at $2,017/2,022 against $1,997/2,007 in New York late on Thursday, when it hit a record high of $2,025.

South Africa, which accounts for 80 per cent of global platinum supply, has been hard hit by power cuts since early January, forcing mines to shut for five days last month.

Analysts say the platinum deficit could widen to more than 400,000 ounces by the end of 2008, compared with about 265,000 ounces in 2007.

The market had a surplus of 65,000 ounces in 2006 following seven successive years of deficits.

Platinum supplies are heavily dependent on this market, and the delicate power supply situation as well as concerns about mine safety leave mine output extremely susceptible to potential disruptions, Barclays Capital said.

The market is set to retain its deficit, further eroding the low level of above ground inventories thus further buoying platinum prices, it said in a report.

Gold also advanced, helped by a weaker dollar and Thursday’s comments from Federal Reserve Chairman Ben Bernanke reinforcing the impression it will cut its benchmark rate by 50 basis points in the US central bank’s next policy meeting in March.

Spot gold rose as high as $913.30 an ounce and was last quoted at $909.70/910.40 an ounce, against $907.10/907.90 in New York late on Thursday.

US gold futures rose $2.5 an ounce to $913.30. The return of the weak dollar/strong oil scenario should prove support for gold in the coming sessions.

As well, traders again interpreted Bernanke’s comments to suggest a further rate cut may be in the pipeline, said James Moore.

Gold now needs to conquer chart resistance at $913 and $927 or else the metal will remain vulnerable to a deeper correction back to the $875-$882 area.

Palladium firmed to $436/441 an ounce from $433/437, while silver rose to $17.35/17.40 from $17.24/17.29 an ounce in the US market.—Reuters