Palladium hit an all-time peak on Wednesday amid concerns over tight supply of the autocatalyst metal, while
gold prices held steady as investors awaited an impending decision by the U.S. Federal Reserve on monetary policy.
Spot palladium was up 0.4 percent at $1,602.76 per ounce as of 10:24 a.m. EDT (1424 GMT), having earlier touched a record high of $1,608.
Palladium is extensively used in the making of catalytic converters in vehicles and has benefited from a switch away from diesel engines and demand for hybrid electric vehicles.
"Europe came up with stringent environmental demand and environmental initiatives while we have supply issues from South Africa and Russia," said Eli Tesfaye, senior market strategist for brokerage RJO Futures in Chicago.
"There is now talk about using substitutes, such as platinum, which has come up higher as palladium gets more and more expensive."
A possible temporary export ban on precious metal scrap from Russia and hopes of economic stimulus from China rubbing off on industrial metals has helped lift prices. This year alone, spot prices have jumped over 26 percent.
Platinum also gained, rising 1.5 percent to $858.43 per ounce, having surged 3 percent on Tuesday on increased demand for the closest substitute to expensive palladium's industrial properties.
Investor flows into physically backed platinum exchange-traded funds (ETFs) and a sharp drop in speculative bets on lower prices suggest platinum is on the cusp of recovery.
Spot gold was little changed at $1,305.71 per ounce, and holding ground above the psychologically significant $1,300 level as investors widely expected the U.S. central bank would hold interest rates steady following a two-day policy meeting.
Bets on an interest rate cut have increased after weaker-than-expected manufacturing data on Friday.
Gold trading was cautious amid Fed talks on interest rates and the metal was holding well at the $1,300 area, said George Gero, managing director at RBC Wealth Management, in a note.
Gold is highly sensitive to rising interest rates, which lift the opportunity cost of holding non-yielding bullion. They also boost the dollar, in which the metal is priced.
Prices may test a support at $1,300 per ounce, as it failed to break a resistance at $1,311, according to Reuters analyst Wang Tao.
Capping gold's momentum were gains in the U.S. dollar on reports of U.S. concerns that China is pushing back against American demands in trade talks.
Investors since last year have favoured the dollar as a safe haven amid the Sino-U.S. trade tensions.
Meanwhile, silver eased to $15.33 per ounce.