Rubber Pares Third Weekly Advance on U.S. Fiscal-Cliff Concerns
Rubber pared a third weekly gain after U.S. House Republican leaders canceled a planned vote that would permit higher taxes amid stalled budget talks.
Rubber for delivery in May fell as much as 0.6 percent to 281 yen a kilogram ($3,346 a metric ton) before trading at 281.5 yen on the Tokyo Commodity Exchange at 12:02 p.m. The most- active contract has increased 1.8 percent this week.
House Republican leaders canceled a planned vote tonight on Speaker John Boehner’s plan to allow higher tax rates for annual income above $1 million amid stalled budget talks. Asian shares declined, curbing investor appetite for riskier assets.
“Rubber was capped by concerns over the U.S. fiscal cliff,” Kazuhiko Saito, an analyst at broker Fujitomi Co. in Tokyo, said today by phone. “Still, there were no aggressive sellers amid speculation that the yen will decline further on economic policies by the new Japanese government.”
The yen traded near an almost 20-month low against the dollar after the Bank of Japan yesterday boosted monetary stimulus and agreed to review its 1 percent inflation target. Incoming Prime Minister Shinzo Abe asked Bank of Japan Governor Masaaki Shirakawa to agree to set a 2 percent target.
Rubber for May delivery added 0.8 percent to 25,085 yuan ($4,025) a ton on the Shanghai Futures Exchange. Thai rubber free-on-board remained unchanged at 96.65 baht ($3.16) a kilogram yesterday, according to the Rubber Research Institute of Thailand.
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