Nov. 15 (Bloomberg) -- Rubber advanced for a second day, rising to the highest level in almost two weeks, as the yen slumped to a six-month low on expectations a December vote will hand power to the opposition, which favors unlimited easing.
Rubber for delivery in April jumped 2.1 percent to close at 251 yen a kilogram ($3,104 a metric ton) on the Tokyo Commodity Exchange, the highest settlement for the most-active contract since Nov. 2. Futures gained 1.9 percent this week, paring the year’s loss to 4.7 percent.
The yen tumbled and Japanese shares jumped as opposition leader Shinzo Abe said the Bank of Japan’s benchmark rate should be lowered to zero or below and pledged to raise public spending if his party wins. Prime Minister Yoshihiko Noda said yesterday he will dissolve parliament, spurring a vote Dec. 16.
“Japan’s election will establish a new cabinet that will likely take a more aggressive stance on monetary easing and economic stimulus,” Takaki Shigemoto, an analyst at research company JSC Corp. in Tokyo, said by phone today.
Futures also gained as a rally in crude oil yesterday boosted the appeal of natural rubber as an alternative to synthetic products, he said. Oil traded near the highest level in more than a week after Israel attacked the Gaza Strip, raising concern unrest in the Middle East will disrupt supplies.
Rubber for May delivery gained 0.8 percent to 24,195 yuan ($3,885) a ton on the Shanghai Futures Exchange. Thai rubber free-on-board rose 2 percent to 91.40 baht ($2.98) a kilogram today, according to the Rubber Research Institute of Thailand. Rains in southern Thailand, the largest plantation area in the biggest exporter, supported prices, said Chaiwat Muenmee, an analyst at Bangkok-based commodity broker DS Futures Co.
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