Rubber extended a rally for a fifth day as a weaker Japanese currency boosted the appeal of yen-based contracts and growing U.S. auto sales raised demand.
Rubber for delivery in December climbed as much as 1.4 percent to 249 yen a kilogram ($2,473 a metric ton) on the Tokyo Commodity Exchange, the highest level for a most-active contract since June 11. Futures traded at 248.2 yen at 10:29 a.m., paring losses for this year to 18 percent.
The yen declined to 100.86 per dollar, the lowest level since May 31. U.S. light-vehicle sales climbed 9.2 percent to 1.4 million last month, according to researcher Autodata Corp., exceeding the 1.38 million average estimate of 10 analysts in a survey by Bloomberg.
“Better-than-expected auto sales in the U.S. are positive for rubber demand,” Takaki Shigemoto, an analyst at research company JSC Corp. in Tokyo, said by phone today. “A weakening yen is another positive factor.”
Americans are buying new cars and trucks at the fastest rate since 2007. Ford Motor Co., Chrysler Group LLC and analysts said they expect replacement of older models, attractive financing offers and an improving economy will keep propelling industry sales.
The yen may weaken further as U.S. payrolls data, scheduled to be released on July 5, may add to evidence that the world’s largest economy is gathering momentum, Shigemoto said.
Rubber for January delivery on the Shanghai Futures Exchange added 0.4 percent to 18,250yuan ($2,975) a ton. Thai rubber free-on-board fell 1.7 percent to 84.65 baht ($2.73) a kilogram yesterday, according to the Rubber Research Institute of Thailand.
Source: Bloomberg
