SINGAPORE: Japanese rubber futures extended losses for a third day on Thursday, as spread traders adjusted their positions following poor economic performance from US and China.
Osaka Exchange’s rubber contract for October delivery finished 1.6 yen, or 0.8%, lower at 209.5 yen ($1.55) per kg. The rubber contract on the Shanghai futures exchange for September delivery rose 15 yuan to finish at 12,160 yuan ($1,759.23) per tonne. Japan’s benchmark Nikkei average closed up 0.02%.
Japanese rubber is falling as spread traders are taking positions, said a Singapore-based trader, adding that actual demand is weak now that wintering for rubber trees is over, so more volume will be out by early June.
China’s consumer prices rose at a slower pace and missed expectations in April, while factory gate deflation deepened, data showed on Thursday, suggesting more stimulus may be needed to boost a patchy post-COVID economic recovery. Most Japanese shares fell on Thursday as investors pulled back after recent gains and took stock of a mixed bag of corporate earnings ahead of a high-profile Group of Seven nations meeting.
Group of Seven (G7) finance leaders on Thursday opened three days of meetings in Japan and will seek to diversify supply chains away from China - though a standoff over raising the US debt ceiling overshadowed the meeting.
Still, the annual increase in US consumer prices slowed to below 5% in April for the first time in two years, while a key inflation measure monitored by the Federal Reserve subsided, potentially providing cover for the central bank to pause further interest rate hikes next month.
The front-month rubber contract on Singapore Exchange’s SICOM platform for June delivery last traded at 136.0 US cents per kg, down 1.2%.
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