Tokyo rubber futures rose to their highest in two months on Friday while Shanghai rubber futures also settled higher as compared with an earlier Friday on the back of a decline of rubber inventories in China and Japan and supply tightness in rubber producing countries amid continued purchases for prompt shipment by tire makers.
Firmness in the Dow Jones Industrial Average and Nikkei indices and the yen against the dollar, the continued rises of crude oil futures and the decisions by the U.S. Federal Reserve on Wednesday to continue slashing a further $10 billion off its monthly bond-buying and to maintain its interest rates at record lows into next year were also the major supportive factors that restored investors’ confidence and convinced them to cover their short positions on rubber futures during the week.
It cannot be denied that a drawdown in rubber stocks in Qingdao and Shanghai and Japan, supply tightness in natural rubber (NR) producing countries, a continued rise in crude oil futures, and continued demand for rubber in the tire industry will support NR prices in the coming weeks.
– IRCo
