Rubber climbed to a two-week high, heading for the best weekly rally in five, as Japan’s currency breached 100 per dollar for the first time since September, boosting the appeal of yen-denominated futures.
The contract for April delivery on the Tokyo Commodity Exchange gained as much as 1.5 percent to 263 yen a kilogram ($2,626 a metric ton), the highest level since Oct. 31, and was at 262.8 yen at 10:03 a.m.. Futures gained 1.9 percent this week, the best performance since the week through Oct. 11.
The yen slid to 100.26 per dollar, the lowest level since Sept. 11, as demand for haven assets weakened on confidence policy makers in the U.S., Japan and Europe will remain committed to economic stimulus. Janet Yellen, the nominee for the chairman of the Federal Reserve, said yesterday she’s committed to promoting a strong economic recovery and will ensure monetary stimulus isn’t removed too soon.
“Investor optimism about global recovery increased, spurring sales of the yen and boosting futures in Tokyo,” said Kazuhiko Saito, an analyst at broker Fujitomi Co. in Tokyo.
Rubber for May delivery on the Shanghai Futures Exchange added 0.3 percent to 19,375 yuan($3,180) a ton. Thai rubber free-on-board dropped 0.3 percent to 78.60 baht ($2.49) a kilogram yesterday, according to the Rubber Research Institute of Thailand.
The Rubber Association of Indonesia urged farmers to reduce tapping, cutting 2014 production by 10 percent, in a move to lower global stocks and balance supply and demand. It expects output of 3.18 million tons this year.