SHANGHAI: Japanese rubber futures rose on Friday, on the back of the weakest yen level since July 2024, which powered Japanese equities but increased the risk of a currency intervention.
The Osaka Exchange (OSE) rubber contract for November delivery was up 1.1 yen, or 0.25percent, at 440.6 yen (USD2.73) per kg.
A weaker Japanese currency makes yen-denominated assets more affordable to overseas buyers. The contract has gained 3.14percent this week. The Shanghai Futures Exchange is closed on Friday, June 19 for a holiday.
The yen weakened as far as 161.45 per dollar, its lowest since July 2024, wiping out gains made after Tokyo’s intervention on April 30. A break above the currency pair’s 2024 high of 161.99 would send the yen to its weakest level since 1986.
With the Juneteenth trading break looming in the United States, thin liquidity conditions could open the door for Japan to step into markets again, as it did during its own holidays in late April and early May, when it intervened to the tune of 11.7 trillion yen (USD72.54 billion).
Japan’s Nikkei surged past key 71,000 level for the first time on Thursday after the United States and Iran extended their ceasefire, easing geopolitical tensions and supporting risk appetite.
However, softer oil undermained price gains.
Oil prices fell on Friday as prospects brightened for more supply after oil tankers began moving through the reopening Strait of Hormuz following a peace deal between the United States and Iran.
The front-month rubber contract on Singapore Exchange’s SICOM platform for July delivery last traded at 226.7 US cents per kg, down 0.3percent.