Rubber rebounded from the lowest level in more than two months as a weaker Japanese currency boosted the appeal of yen-based contracts and growth in U.S. car sales raised speculation demand will grow for the commodity used in tires.
The contract for delivery in August advanced as much as 1.2 percent to 287.4 yen a kilogram ($3,079 a metric ton) before trading at 284.9 yen on the Tokyo Commodity Exchange at 10:29 a.m. It fell to 282.7 yen in after-hours trading on March 1, the lowest level since Dec. 21. Futures lost 5.7 percent this year.
Japan’s currency declined to 93.73 per dollar after Haruhiko Kuroda said a Bank of Japan under his leadership would do whatever is needed to combat 15 years of deflation. U.S. light-vehicle sales in February rose 3.7 percent to 1.19 million, heading for the best year since 2007, according to the research company Autodata.
“Optimism about the U.S. growth and a weak yen gave support to rubber futures,” Takaki Shigemoto, an analyst at research company JSC Corp. in Tokyo, said by phone today.
Kuroda told a parliamentary hearing today on his nomination as governor that the BOJ hasn’t bought enough assets to end deflation. The opposition Democratic Party of Japan will approve the appointment of Kuroda, Jiji reported, citing the party’s secretary general. The Asian Development Bank president would take office after Governor Masaaki Shirakawa retires March 19, if confirmed by parliament.
The contract for September delivery on the Shanghai Futures Exchange fell 0.6 percent to 23,825 yuan ($3,825) a ton. Rubber inventories rose 883 tons to 103,299 tons, the bourse said on March 1, based on a survey of nine warehouses in Shanghai, Shandong, Yunnan, Hainan and Tianjin.
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