SINGAPORE, Sept 25 (Reuters) –
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Japanese rubber futures hit a 13-year peak on Wednesday, boosted by the Chinese government’s announcement of additional stimulus measures.
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The Osaka Exchange (OSE) rubber contract for February delivery JRUc6, 0#2JRU: closed up 2 yen, or 0.52%, at 387 yen($2.69) per kg. The contract hit an intraday high of 400 yen,its highest since April 25, 2011.
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The rubber contract on the Shanghai Futures Exchange (SHFE) for January delivery SNRv1 ended up 540 yuan, or 3.04%, at 18,300 yuan ($2,607.21) per metric ton, its highest since March 20, 2017.
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The current abnormal rally in futures exchanges is driven by speculative funds as they cheer China’s stimulus measures, said Jom Jacob, chief analyst at analysis firm What Next Rubber. Investors consider the measures to have the potential to lift demand for natural rubber, he said.
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China’s central bank lowered the cost of its medium-term loans to banks on Wednesday, in line with efforts for an economic stimulus.
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The most active October butadiene rubber contract on the SHFE SHBRv1 closed up 250 yuan, or 1.61%, at 15,775 yuan ($2,247.47) per metric ton.
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Top rubber producer Thailand’s meteorological agency warned of heavy to very-heavy rains that may cause flash floods from Sept. 25 to Oct. 1.
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The yen JPY=EBS eased slightly to 143.32 per dollar. USD/
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A stronger yen makes yen-denominated assets less affordable to overseas buyers. FRX/
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Oil prices fell on Wednesday as investors reassessed the ability of China’s stimulus plans to boost the economy enough to drive more fuel demand growth. O/R
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Natural rubber often takes direction from oil prices as it competes for a market share with synthetic rubber, which is made from crude oil.
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The front-month rubber contract on Singapore Exchange’s SICOM platform for October delivery STFc1 last traded at 204 U.S. cents per kg, up 1%.
($1 = 143.7100 yen)
($1 = 7.0190 yuan)
Reporting by Haridas; editing by Sumana Nandy and Sonia Cheema
