Rubber climbed to the highest level in five weeks as Japan’s currency dropped against the dollar, raising the appeal of yen-based contracts.
Rubber for delivery in December on the Tokyo Commodity Exchange added 1.2 percent to 247.6 yen a kilogram ($2,474 a metric ton), the highest settlement since June 11. The rally pared losses for this year to 18 percent.
The yen breached 100 per dollar amid speculation Group of 20 finance ministers and central bankers meeting this week will endorse the Bank of Japan’s monetary easing. Russian Deputy Finance Minister Sergei Storchak said the G-20 probably won’t call for a tapering of stimulus in nations including Japan.
“Futures drew support from the currency market,” said Takaki Shigemoto, an analyst at research company JSC Corp. in Tokyo. “The yen may decline further depending on the result of the G-20 meeting.”
The BOJ doubled monthly bond purchases to more than 7 trillion yen in April, after Prime Minister Shinzo Abe urged the central bank to take steps to overcome deflation. Opinion polls have shown Abe’s Liberal Democratic Party and coalition partners are likely to win a majority in the upper house election this weekend, ending a hung parliament.
Rubber for January delivery on the Shanghai Futures Exchange rose 0.5 percent to close at 18,345 yuan ($2,988) a ton.
Thai rubber free-on-board was unchanged at 78.85 baht ($2.54) a kilogram today, according to the Rubber Research Institute of Thailand.