TOKYO (Jan 15): Benchmark Tokyo rubber futures hit a 3½-month high on Monday, backed by higher Shanghai futures which helped offset a stronger yen against the US dollar.
“There were no fresh fundamental news that triggered buying, but investors may have stepped up investing as rubber prices tend to rise in January ahead of China’s Lunar New Year,” said Jiong Gu, analyst, Yutaka Shoji Co.
The Tokyo Commodity Exchange (TOCOM) rubber contract for June delivery finished up 4.3 yen, or 2.0%, at 214.8 yen (US$1.94) per kg. Earlier in the session, it touched its highest since Sept. 28 of 215.0 yen.
The most-active rubber contract on the Shanghai futures exchange for May delivery rose 135 yuan to finish at 14,445 yuan (US$2,247) per tonne.
The rally came despite a stronger yen which makes yen-denominated assets less affordable when purchased in other currencies.
The dollar slipped to its lowest since mid-September against the yen, as comments from the head of the Bank of Japan highlighted Japan’s economic recovery.
“The TOCOM’s rally may be short-lived as the rubber market is not fundamentally strong,” Gu said.
The front-month rubber contract on Singapore’s SICOM exchange for February delivery last traded at 153.9 US cents per kg, up 3.2 cents.
(US$1 = 110.5900 yen)
(US$1 = 6.4290 Chinese yuan)
