Investing.com-- Platinum prices are likely to fall back within a trading range seen over at least the last decade, Goldman Sachs analysts said in a Wednesday note, with a recent breakout likely to be short-lived.

Platinum prices have been on a tear since late-May, as a bullish industry report sparked increased buying on expectations of tighter supplies and strong demand. The precious metal, widely considered as an investment alternative to gold and silver, surged to an over four-year high of nearly $1,280 an ounce. This also saw the metal largely break out of a $800 to $1,150/oz trading range seen for most of the past decade.

But GS analysts warned that a sustained breakout was unlikely, with China expected to play a major role in any pullback.

GS said that Chinese demand, which is a major portion of platinum demand, was likely to slow amid high prices. China platinum jewelery demand was seen cooling since April as prices of the white metal advanced, GS said, while platinum withdrawals from the Shanghai Gold Exchange are expected to slow.

Platinum is also expected to see softer demand in the automobile industry, especially amid a broad pivot towards electric vehicles in China. Platinum plays a key role in emissions controls in vehicles, which EVs do not need.

EV demand outside China also remained relatively strong, especially in Europe.

GS also expects global platinum supplies to be stable to moderately higher this year, barring any potential electricity-related disruptions in South Africa.

“We expect South Africa supply, which accounts for approximately 70% of global platinum production, to rise moderately, in line with guidance from the major PGM miners there,” GS analysts said.

Strong South African production is likely to keep platinum markets well-supplied, limiting any major price increases in the metal.

Still, platinum prices are trading up 37.3% so far in 2025, more than a 28.6% gain in gold.