Rubber Retreats After Trading Near One-Week High as Yen Weakens
Rubber retreated from the highest level in almost a week as investors sold the commodity after the yen’s decline against the dollar stalled, reducing the attractiveness of contracts based in the Japanese currency.
The contract for delivery in June lost 0.2 percent to 311.1 yen a kilogram ($3,417 a metric ton) at 11:38 a.m. on the Tokyo Commodity Exchange after advancing to 313.8 yen, the highest level since Jan. 22. Futures for July delivery, listed on the bourse today, traded at 314.4 yen.
The dollar reached its highest level in 2 1/2 years versus the yen before data forecast to show a pickup in U.S. durable goods orders, adding to signs of a recovery in the world’s biggest economy. It traded at 91.06 yen after climbing to 91.26 yen, the highest level since June 2010.
“Investors locked in profits as the yen broke through 90 per dollar, the level that ruling party politicians had previously described as appropriate,” said Takaki Shigemoto, an analyst at research company JSC Corp. Excessive decline in the yen may be negative for Japan’s economy as costs to import fuels and foods will increase, curbing consumption, he said.
Rubber for May delivery fell 0.2 percent to 25,510 yuan ($4,096) a ton on the Shanghai Futures Exchange. Thai rubber free-on-board added 0.3 percent to 97.80 baht ($3.27) a kilogram on Jan. 25, according to the Rubber Research Institute of Thailand.
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