TOKYO, Jan 22 (Reuters) – Key TOCOM rubber futures fell slightly on Tuesday, extending the previous day’s 1.5-percent decline, with a recent selloff in the yen halting ahead of the outcome of a Bank of Japan policy meeting, with expectations running high for bold monetary easing.
FUNDAMENTALS
* The key Tokyo Commodity Exchange rubber contract for June delivery <0#2JRU:> was down 1.6 yen, or 0.5 percent, at 310.0 yen per kg as of 0030 GMT.
* The contract hit a peak of 317.6 yen during the evening session on Friday, the highest since it reached a 9-month high of 321.0 yen on Jan 11.
* The BOJ is set on Tuesday to unveil its most determined effort yet to beat years of economic stagnation, but the big challenge will be how to impress markets already pricing in a doubling of its inflation target and further asset buying.
* Bold measures by the BOJ could increase investor appetite for riskier assets such as commodities, although expectations of such steps have already been propping up prices.
* U.S. financial markets were closed on Monday for the Martin Luther King Jr. holiday
MARKET NEWS
* The yen’s recent violent selloff came to an abrupt halt Tuesday, with the dollar trading around 89.60 yen, off a 2-1/2-year high of 90.25 yen marked on Monday.
* The Nikkei share average barely budged at Tuesday’s open ahead of the end of the BOJ’s two-day gathering.
* Brent crude oil slipped below $112 a barrel on Monday, ending a three-day rally, as pessimism over global economic growth returned traders’ focus to healthy supply levels, offsetting fears of unrest in North Africa.
DATA EVENTS
* The following data is expected on Tuesday:
0300 Japan BOJ rate decision
1000 Germany ZEW economic sentiment Jan
1330 U.S. Chicago Fed National Activity Index
1500 U.S. Existing home sales Dec
1500 U.S. Richmond Fed composite index Jan
(Reporting by Risa Maeda; Editing by Joseph Radford)
SOurce: Reuters
