Rubber in Tokyo Has First Weekly Loss in Three as Yen Climbs

Rubber had its first weekly loss since Oct. 4 as Japan’s currency strengthened to the highest level in more than two weeks against the dollar, weakening the appeal of yen-denominated futures.

The contract for delivery in March on the Tokyo Commodity Exchange slid 2.3 percent to 256.6 yen a kilogram ($2,645 a metric ton). Futures fell 4 percent this week and are headed for a second monthly drop.

The yen climbed to 96.94 per dollar, the highest level since Oct. 9. The U.S. currency came under pressure as weaker-than-forecast economic data and concern that its economy was hurt by a government shutdown added to bets the Federal Reserve will delay tapering stimulus until next year.

“A lack of support from the currency market sapped investor appetite for rubber futures,” said Takaki Shigemoto, an analyst at research company JSC Corp. in Tokyo.

The partial U.S. government shutdown that began Oct. 1 amid a political deadlock in Washington over spending and the debt ceiling probably trimmed 0.25 percentage point from fourth-quarter growth and cost 120,000 jobs in October, President Barack Obama’s chief economic adviser said on Oct. 22.

Rubber for January delivery on the Shanghai Futures Exchange lost 3.2 percent to 19,500 yuan ($3,206) a ton. Thai rubber free-on-board was unchanged at 79.15 baht ($2.54) a kilogram today, according to the Rubber Research Institute of Thailand.

Global output will expand 4.5 percent next year from an estimated 11.7 million tons in 2013 as plantings between 2006 and 2008 become ready for tapping, according to Lekshmi Nair, senior economist at the International Rubber Study Group.

Before it's here, it's on the Bloomberg Terminal.