Rubber declined as the strengthening Japanese currency reduced investor appetite for yen-denominated contracts for the commodity used in tires.
Futures for delivery in January fell as much as 1.6 percent to 245.9 yen a kilogram ($2,526 a metric ton) on the Tokyo Commodity Exchange, before trading at 249.8 yen at 11:04 a.m. local time. Rubber lost 18 percent this year.
The yen touched a six-week high as the Bank of Japan starts a policy meeting today on prospects it will refrain from adding to unprecedented stimulus that’s helped to weaken the currency. Data tomorrow may show Japan posted a current-account surplus in June, according to a Bloomberg survey of economists.
“The strong yen against the dollar and falling equities markets drove the decline in Tocom rubber,” said Hiroyuki Kikukawa, general manager for research at Nihon Unicom Inc. “Investors are in risk-off mode.”
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Rubber for delivery in January dropped 0.2 percent to 18,370 yuan ($3,001) a ton on the Shanghai Futures Exchange. Thai rubber free-on-board fell 0.7 percent to 76.75 baht ($2.44) a kilogram yesterday, according to the Rubber Research Institute of Thailand. Rains across the Thai south, the main plantation area, have disrupted tapping, it said.
Source: Bloomberg
