Weaker Yen Sends Japanese Rubber Futures Soaring
The Japanese rubber futures market saw gains for the third consecutive session on Friday, driven by a weaker yen and a rally in Tokyo equities. The Osaka Exchange's (OSE) rubber contract for February delivery rose 2.3 yen, or 0.54%, to 430.2 yen (USD2.74) per kg.
The Shanghai Futures Exchange's (SHFE) rubber contract for January delivery fell 250 yuan, or 1.32%, to 18,670 yuan (USD2,787.86) per metric ton. However, analysts from Guangzhou Futures pointed out that Thai latex and cup lump prices have been relatively strong recently, with upstream processing plants holding low inventories and showing a willingness to restock.
The yen's decline against major peers in Asian trading on Friday was attributed to the Bank of Japan's widely expected rate hike failing to halt the currency's decline. A weaker yen makes yen-denominated assets more attractive to overseas buyers, contributing to the Nikkei's 1.7% surge to 65,221.53.
The oil price drop of 2% on Friday weighed on natural rubber prices, as it competes with synthetic rubber for market share.