Rubber Declines for Second Day as Yen’s Rebound Weakens AppealAya Takada
Rubber declined for a second day as Japan’s currency rebounded from a two-month low against the dollar, reducing the appeal of yen-denominated futures.
The contract for delivery in April on the Tokyo Commodity Exchange lost 1.1 percent to settle at 258.4 yen a kilogram ($2,588 a metric ton). Futures have fallen 15 percent this year.
The dollar weakened against most major peers after Fed Bank of New York President William Dudley said that while he’s getting “more hopeful” the U.S. economy is gaining strength, policy will probably remain accommodative for a long time.
“The market lost steam as the dollar’s rally against the yen stalled,” said Takaki Shigemoto, an analyst at research company JSC Corp. in Tokyo. “Rubber is vulnerable to selling without support from the currency market as supply from Southeast Asia is abundant.”
Futures also dropped after oil in New York slid to a five-month low yesterday, boosting speculation the price of synthetic rubber will drop, he said. West Texas Intermediate oil for December delivery traded at $92.88 a barrel.
Rubber for May delivery on the Shanghai Futures Exchange added 0.5 percent to close at 19,230 yuan ($3,157) a ton. Stockpiles monitored by the bourse expanded 6.1 percent to 163,604 tons last week, the highest level since November 2004.
Thai rubber free-on-board lost 0.3 percent to 78.35 baht ($2.48) a kilogram today, according to the Rubber Research Institute of Thailand.