SINGAPORE: Japanese rubber futures rose on Friday as the yen’s slide against the US dollar prompted buying, with support also coming from a rebound in Shanghai futures from 2-1/2-month lows on position adjustments ahead of China’s holiday week.
The Osaka Exchange rubber contract for July delivery finished 2.9 yen, or 1.2%, higher at 239.4 yen ($2.07) per kg after sinking earlier to its lowest in four and a half weeks at 232.0 yen.
The benchmark booked its second straight weekly decline with a 2% loss amid concerns that increases to US interest rates could slow a recovery in the global economy.
“The OSE tracked the Shanghai market, which had taken a dive in an early trade but rebounded later,” one Singapore-based trader said, adding that a weaker yen also affected prices.
The rubber contract on the Shanghai futures exchange for May delivery slid by 100 yuan, or 0.7%, to finish at 14,150 yuan ($2,223) a tonne on Friday. It earlier touched 13,860 yuan, the lowest level since Nov. 10.
The US dollar was quoted around 115.62 yen, against 114.65 yen on Thursday. A weaker yen makes yen-denominated assets more affordable when purchased in other currencies.
“It was all about position adjustment ahead of the long holiday in China,” one Tokyo dealer said.