SHANGHAI: Japanese rubber futures rose on Friday and recorded a second consecutive weekly gain, as a weaker yen, along with the threat of imminent currency intervention by the Bank of Japan, spurred buying. The Osaka Exchange rubber contract for November delivery was up 1.1 yen, or 0.26percent, at 429.6 yen (USD2.69) per kg.
The contract has gained 1.78percent this week, and recorded a second consecutive weekly gain. The rubber contract on the Shanghai Futures Exchange for September delivery fell 120 yuan, or 0.67percent, to 17,760 yuan (USD2,621.52) per metric ton.
The most active July butadiene rubber contract on the SHFE was down 585 yuan, or 4.05percent, at 13,875 yuan per metric ton. The prices of Thailand’s benchmark export-grade smoked rubber sheet (RSS3) and block rubber were up 1.04percent and 0.96percent, respectively.
The yen hit the 160 barrier for a third consecutive session, prompting pushback from Japanese officials, while the US dollar is on track for a weekly gain as Gulf tensions fuel safe-haven flows. Japan is ready to respond appropriately at any time on foreign exchange and reserves the right to take “decisive action” against excessive volatility, Finance Minister Satsuki Katayama said.
Still, high raw material prices continue to temper demand for rubber in China. Orders in the domestic and export markets for tires are under pressure, coupled with persistently high raw material costs, leading to significant operational pressure on companies, a report from Chinese broker Guoxin Futures said.
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