Rubber rebounds as yen weakens on signs of US & China recovery

ERJ staff report (TP)

Tokyo − Rubber rebounded yesterday to the highest level in almost a week after Japan’s currency slid on US and Chinese data that exceeded analyst estimates, boosting the appeal of yen-denominated futures, reported Aya Takada for Bloomberg.

The contract for delivery in April on the Tokyo Commodity Exchange advanced as much as 1.9 percent to 261.7 yen (€1.96) a kg, the highest since 5 November. Futures traded at 261.1 yen (€1.95) at 9:57am (11 November, Japan time), paring losses to 14 percent this year.

The yen traded near a seven-week low against the dollar after dropping 1 percent on 8 November, when data showed US payrolls added almost twice as many workers as economists projected last month. Factory output in China rose more than analysts estimated in October and inflation quickened less than forecast, adding optimism about the growth in the world’s second-largest economy.

“The data increased investors’ risk appetite, weakening the yen and boosting futures in Tokyo,” said Kazuhiko Saito, an analyst at broker Fujitomi in Tokyo.

Natural rubber imports by China, the biggest buyer, were 190,000 tonnes in October, according to the customs agency. Volume increased from 179,921 tonnes in September and 170,409 tonnes in the same month last year, Bloomberg data showed.

Rubber for May delivery on the Shanghai Futures Exchange climbed 0.6 percent to 19,595 yuan (€2,402.75) a tonne. Stockpiles monitored by the bourse rose 4.4 percent to 154,194 tonnes, the highest since November 2004, data from the exchange showed.

Thai rubber free-on-board gained 0.6 percent to 78.05 baht (€1.84) a kg on 8 November, according to the Rubber Research Institute of Thailand.

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Full story from Bloomberg