Rubber declined for a second day as a strengthening Japanese currency reduced the appeal of yen-based contracts and amid speculation the Federal Reserve will soon be able to cut stimulus.
The contract for delivery in January dropped as much as 1 percent to 243.4 yen a kilogram ($2,484 a metric ton) on the Tokyo Commodity Exchange, before trading at 244.4 yen at 11:28 a.m. Futures have fallen 19 percent this year.
The yen rose against all major peers amid speculation the Bank of Japan will refrain from adding to stimulus at a meeting starting tomorrow. The Institute for Supply Management U.S. non-manufacturing index came in above the median estimate for July, as Federal Reserve Bank of Dallas President Richard Fisher said policy makers are closer to slowing bond purchases.
“The decline in rubber is being driven by a stronger yen,” said Kazunori Kokubo, managing director at Yutaka Shoji Singapore Pte.
Rubber for delivery in January dropped 0.3 percent to 18,220 yuan ($2,976) a ton on the Shanghai Futures Exchange. Thai rubber free-on-board was unchanged at 77.25 baht ($2.46) a kilogram yesterday, according to the Rubber Research Institute of Thailand.
Source: Bloomberg
