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Rubber Swings Between Losses and Gains on China Data, Weak Yen

Rubber swung between losses and gains as data showed China’s manufacturing is growing at a slower pace this month, raising concern that demand may weaken from the world’s largest user of the commodity used in tires. The weaker Japanese currency supported yen-based futures.

Rubber for delivery in September fell as much as 0.7 percent to 249.1 yen a kilogram ($2,520 a metric ton) on the Tokyo Commodity Exchange, the lowest level since April 19. Futures swung between gains and losses and traded at 251.3 yen at 11:48 a.m.

The preliminary reading of 50.5 for China’s Purchasing Managers’ Index released by HSBC Holdings Plc and Markit Economics slowed from a final 51.6 for March. The number was also below the median 51.5 estimate in a Bloomberg News survey of 11 analysts. A reading above 50 indicates expansion.

“Rubber was capped by concerns that slowdown in China’s economy may weaken demand,” Kazuhiko Saito, analyst at broker Fujitomi Co. in Tokyo, said today by phone.

Losses were limited as Japan’s currency traded near a four- year low against the dollar, making yen-denominated futures attractive to investors, he said.

Rubber for September delivery on the Shanghai Futures Exchange was little changed at 18,635 yuan ($3,017) a ton. Thai rubber free-on-board rose 1.9 percent to 80.50 baht ($2.80) a kilogram yesterday, according to Rubber Research Institute of Thailand. The price fell to 79 baht on April 19, the lowest since October 2009.

To contact the reporter on this story: Aya Takada in Tokyo at atakada2@bloomberg.net

To contact the editor responsible for this story: Brett Miller at bmiller30@bloomberg.net

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