Rubber retreated from a nine-month high as the Japanese currency climbed against all of its 16 major peers after comments by Japan’s economy minister raised concerns the nation won’t try to further weaken the currency.
Rubber for delivery in June closed little changed at 312.1 yen a kilogram ($3,514 a metric ton) on the Tokyo Commodity Exchange. Futures reached 321 yen on Jan. 11, the most expensive since April.
Economy Minister Akira Amari said Japan faces risks from declines in the yen after it weakened 3.6 percent this year against a basket of developed market currencies and an excessively weak currency may hurt import costs and households.
“The yen rebound prompted some investors to cash in profits,” Sureerat Kunthongjun, an analyst at AGROW Enterprise Ltd., said by phone from Bangkok. Rubber may regain ground on optimism over economic stimulus and reduced supplies during the low production period, she added.
Bank of Japan (8301) Governor Masaaki Shirakawa, speaking to branch managers today, said the bank will continue to pursue powerful easing. The government said last week it will spend 10.3 trillion yen in new stimulus efforts. The BOJ will review its 1 percent inflation goal at a Jan. 21-22 meeting after Prime Minister Shinzo Abe demanded it double the target.
Rubber for delivery in May fell 1.4 percent to 25,480 yuan ($4,100) a ton on the Shanghai Futures Exchange. Natural rubber inventories monitored by the bourse continued to expand, climbing 1,824 tons to 101,482 tons, the highest since March 2010, the exchange said Jan. 11, based on a survey of nine warehouses in Shanghai, Shandong, Yunnan, Hainan and Tianjin.
Thai rubber free-on-board dropped 0.5 percent to 101.20 baht ($3.36) a kilogram today, according to the Rubber Research Institute of Thailand.