SINGAPORE: Japanese rubber futures rose for a third session on Friday to post their longest weekly gaining streak in four months, as the market tracked stronger physical prices in top producer Thailand, while a weaker yen also lent support.
The Osaka Exchange (OSE) rubber contract for October delivery closed up 3.4 yen, or 1.04%, at 331.3 yen ($2.11) per kg, its highest closing since April 9.
The contract rose 2.89% week-on-week to log its third consecutive weekly rise, its longest weekly winning streak since end January. The rubber contract on the Shanghai Futures Exchange (SHFE) for September delivery rose 100 yuan to finish at 15,025 yuan ($2,073.84) per metric ton.
The price of Thailand’s benchmark export-grade smoked rubber sheet (RSS3) rose 2.53% for the week. Higher rubber futures “could stem from the surprising resilience in prices of field latex prices in Thailand” despite the post-wintering season, said Farah Miller, CEO of Helixtap Technologies, an independent rubber-focused data company.
Nonetheless, the “very flat forward curve” in rubber futures could indicate possible technical correction downwards for front months, Miller added. The Japanese yen weakened 0.1% to 157.10 against the dollar. A weaker currency makes yen-denominated assets more affordable to overseas buyers.
Japan’s core inflation slowed for a second straight month in April, likely signalling that the Bank of Japan will be patient in raising interest rates as consumption remains fragile.
Data on Thursday showed US jobless claims dropped while S&P Global’s Flash PMI survey showed business activity expanded faster than economists forecast in May.
The front-month rubber contract on Singapore Exchange’s SICOM platform for June delivery last traded at 173.9 US cents per kg, up 1.2%.
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