TOKYO (March 15): Benchmark Tokyo rubber futures extended gains to hit a 10-day high on Thursday on the back of firm Shanghai futures, but the gains were limited by a stronger yen against the dollar.
The dollar touched a one-week low against the yen, as lingering worries about a possible global trade war weighed on investors’ risk appetite.
A stronger Japanese currency makes yen-denominated assets less affordable when purchased in other currencies.
Tokyo Commodity Exchange (TOCOM) futures, which set the tone for rubber prices in Southeast Asia, have been trading below 200 yen per kg since the end of January, reflecting weak fundamentals despite some producers’ move to curb exports as rubber stockpiles swell up in Japan and China among others.
“Firm Shanghai supported the market but the gains were limited weighed down by a strong yen,” said a Japanese industry source.
The Tokyo Commodity Exchange rubber contract for August delivery finished 0.5 yen higher at 195.2 yen (US$1.84) per kg after touching 195.8 yen earlier, the highest since March 5.
The most-active rubber contract on the Shanghai futures exchange for May delivery rose 30 yuan to finish at 12,810 yuan (US$2,027) per tonne.
The front-month rubber contract on Singapore’s SICOM exchange for April delivery last traded at 146.8 US cents per kg, down 0.2 cent.
(US$1 = 106.1100 yen)
(US$1 = 6.3187 Chinese yuan)
