SINGAPORE: Japanese rubber futures rose on Wednesday as a weaker yen and stronger oil prices boosted market sentiment.
The Osaka Exchange (OSE) rubber contract for April delivery closed up 9.8 yen, or 2.76%, at 364.3 yen($2.34) per kg. The rubber contract on the Shanghai Futures Exchange (SHFE) for January delivery closed up 335 yuan, or 1.92%, at 17,765 yuan($2,453.73) per metric ton. China left benchmark lending rates unchanged at the monthly fixing on Wednesday, in line with market expectations, after lenders slashed rates by bigger-than-expected margins last month to revive economic activity.
The dollar added 0.39% to 154.84 yen, pulled up by rising US Treasury yields. A weaker currency makes yen-denominated assets more affordable to overseas buyers.
Oil prices held steady for a second day on Wednesday as concerns about escalating hostilities in the Ukraine war potentially disrupting oil supply from Russia and signs of growing Chinese crude imports offset data showing US crude stocks rising. Natural rubber often takes direction from oil prices as it competes for market share with synthetic rubber, which is made from crude oil.
Top rubber producer Thailand’s meteorological agency warned of heavy rains that may cause flash floods from Nov. 20-26. The front-month rubber contract on the Singapore Exchange’s SICOM platform for December delivery last traded at 190.1 US cents per kg, up 3.4%.
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