Japanese rubber futures slip on firmer yen
SINGAPORE: Japanese rubber futures dipped on Tuesday, weighed down by a stronger yen and lower crude oil prices, although signs of easing US-China trade tensions lent some support to the market.
The Osaka Exchange (OSE) rubber contract for April delivery was down 2.1 yen, or 0.67 percent, at 312.5 yen(USD2.07) per kg. The rubber contract on the Shanghai Futures Exchange (SHFE) for January delivery dipped 10 yuan, or 0.07 percent, to 15,360 yuan (USD2,156.39) per metric ton.
The most-active December butadiene rubber contract on the SHFE fell 240 yuan, or 2.17percent, to 10,805 yuan per ton. The yen strengthened more than 0.6percent to 151.855 per dollar ahead of the Bank of Japan meeting later this week where the central bank is expected to stand pat on rates.
A stronger Japanese currency makes yen-denominated assets less affordable to overseas buyers. Japan’s Nikkei eased 0.2percent, having surged 2.5percent on Monday following a rally in all things tech.
Oil prices slipped on pressure from plans by OPEC to boost output. Natural rubber often takes direction from oil prices as it competes for market share with synthetic rubber, which is made from crude oil. Optimism over easing trade tensions between the US and China ahead of an expected meeting between US President Donald Trump and Chinese President Xi Jinping lifted market confidence, Japan Exchange Group said in a report on Monday.
On Sunday, top economic officials from both the countries reached a framework for a trade deal that would pause steeper American tariffs and Chinese rare earths export controls.
The front-month rubber contract on Singapore Exchange’s SICOM platform for November delivery last traded at 174.1 US cents per kg, down 0.2percent.
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