Platinum and gold have been champions of the precious metal world for decades. Both metals are rare, scarce, shiny, and durable, raising their value. Historically, platinum has been seen as a more valuable metal than gold. It was rarer, denser, and heavier than gold, which reflected in its higher spot price, which in turn influenced the price of platinum jewellery. The price of jewellery is influenced by purity, weight, and karat. Platinum jewellery is often worth more than gold since the regulations on the purity of platinum jewellery are stricter than those of gold jewellery. Platinum awards and recognition in pop culture are more prestigious than gold. For example, platinum albums indicate the album sold more than 1,000,000 units, compared to gold record albums selling more than 500,000 units. This association was spurred by platinum’s price being historically higher than gold, but the same fact doesn’t stand in today’s current market with gold soaring astronomically above platinum’s price. When did the price of platinum soar and crash and what happened to the platinum-gold ratio throughout the years?

Pre-Modern Era 

When the Spanish conquistadors first discovered platinum in South America, they thought it was a junk metal. Referred to as “platina” which translates to “little silver” in Spanish, the conquistadors were annoyed that this metal got in their way of gold mining. They tossed the platinum back into the river to mature into gold with the thought that with time, the white metal could ripen and mature into the much more valued yellow metal. Platinum traded for a fraction of gold’s price back and as a result, it was commonly used as counterfeit gold coins because of its similar densities. What the conquistadors did not know was that in a few centuries, platinum's value would skyrocket when humans figured out how to melt and mould the metal.

1800s - Early 1900s

Back during the 1800s to early 1900s, the relationship between gold and platinum was fundamentally different. With the gold standard still in place during this decade, gold was seen as equivalent to money while platinum was just a rare metal. 200 years ago, around the 1800s, it was difficult for manufacturers to work with large quantities of platinum since the melting point of the metal was so high. For comparison, platinum’s melting point is 1,768 °C, over 700 degrees higher than gold’s melting point of 1,064 °C. The demand for platinum reflected this fact as platinum traded only for $5/oz, a quarter of the price of gold. In the 1850s, oxy-hydrogen blowpipe techniques were invented to melt platinum in larger quantities faster. By 1901, the invention of the super-hot oxy-acetylene torch was able to speed up the process even more. With the invention of these tools to work with large quantities of platinum, uses of platinum in jewellery, machinery, and chemistry were established and boosted platinum’s demand. For instance, during the 1880s, the reigning white metal for jewellers to use was silver. However, in 1890, Cartier introduced an all-platinum jewellery line in its iconic garland style with unparalleled lustre, strength, and durability creating unparalleled demand for platinum jewellery. Consumers enjoyed platinum jewellery for its white, minimalistic, and structured look. By the 1920s, platinum jewellery had ruled the world. The cost of the white metal skyrocketed and its spot price sat 60% higher than gold, setting the platinum-gold ratio at 2:1. While platinum was taking off in the world of jewellery, industrial uses of platinum were also being discovered as well. Platinum was an excellent catalyst in chemistry, oil, and crucibles showing just how versatile this once junk metal could be. 

WWI and WWII

The price and demand for platinum remained high until the start of the First World War. During WWI, the use of platinum in jewellery was outright banned because the state needed platinum to engineer rifles and engine parts for the war effort. The demand for platinum did not recover until the beginning of WWII as the end of WWI brought about the beginning of the great depression. During the great depression, the demand for platinum jewellery dropped and the platinum-gold ratio settled at an even 1:1. What brought the great depression and the platinum slump to an end was the start of WWII. In the jewellery industry, platinum usage was limited again since platinum was needed to engineer weapons for the war. Palladium and white gold substituted platinum in jewellery to supplement the demand for white metals. 

Aftermath and 21st Century

The global economic growth after the end of WWII once again accelerated the demand for platinum. Alongside the growing demand for platinum jewellery after supply was stifled during the war, catalytic converters using platinum to filter out harmful emissions from gasoline were invented in 1950. The new mandate by the US Environmental Protection Agency made catalytic converters mandatory on all cars in 1975, giving platinum a permanent surge in demand in the automobile industry. The rebound of the economy and the end of the gold standard led to the highest platinum-gold ratio in 1968 with a 6.63:1 ratio as a result of the US and European markets trying to suppress the price of gold with the London gold pool. The platinum-gold ratio evened out from the mid-1970s to 1990s as a result of the bear markets after the mid-1980s. 

Starting in the early 2000s, the rising industrial demand for platinum and stagnating demand for gold, elevated the platinum-gold ratio. At the beginning of the century, platinum was trading around $544/oz USD and gold was trading around $275/oz USD with a ratio of 2:1. Platinum continued to double the price of gold until the Great Recession hit the world in 2008. Platinum prices surged to new heights in 2008 due to supply disruptions from mines in South Africa and strong demand from the automotive industry resulting in a record spot price of $2252/oz USD in March of 2008. However, the prices of platinum would soon crash in November of the same year, trading only at a fraction of its value before - $774/oz USD. The introduction of electrical and hybrid vehicles reduced the industrial demand for platinum as a catalyst in ICE converters and starting in 2011, the platinum-gold ratio would flip in gold’s favour. Today, gold is mainly used as a metal for monetary uses and investing while platinum has been relegated to a metal mainly for industrial use. As of January 2025, the platinum-gold ratio sits at 1:2.88 where gold is 2.88 times more expensive than platinum.