TOKYO, Aug 17 (Reuters) – Benchmark Tokyo rubber futures rose on Wednesday toward a three-week high hit in the previous session, supported by the yen’s fall from a seven-week top against the U.S.dollar, but trades were thin with many investors away for summer holidays.
The dollar extended its recovery against the yen after bouncing back from a seven-week low on the back of hawkish comments from a pair of Federal Reserve officials on Tuesday. FRX/ A weaker yen makes yen-denominated assets more affordable when purchased in other currencies.
The Tokyo Commodity Exchange (TOCOM) rubber contract for January delivery JRUc6 0#2JRU: finished 1.3 yen, or 0.8 percent, higher at 158.4 yen ($1.57) per kg, heading closer to a high of 160.2 yen hit in the previous session. “The TOCOM has been stuck mostly in a range of 150 and 160 yen, with most of trades done by arbitrageurs of Tokyo and Shanghai markets,” said Kaname Gokon, a strategist with Okato Shoji Co Ltd.
The TOCOM futures, which set the tone for tyre rubber prices in Southeast Asia, have been under pressure since May amid lingering concerns over slower demand in the world’s top buyer, China. “It’s hard to expect the TOCOM benchmark to move out of the range any time soon, given languished trades from retail investors in Japan,” Gokon said.
The most-active rubber contract on the Shanghai futures exchange for January delivery SNRcv1 lost 45 yuan to finish at 13,065 yuan ($1,970.41) per tonne. The front-month rubber contract on Singapore’s SICOM exchange for September delivery STFc1 last traded at 132.5 U.S. cents per kg, down 0.4 cent. ($1 = 100.7600 yen) ($1 = 6.6306 Chinese yuan)
(Reporting by Yuka Obayashi; Editing by Subhranshu Sahu)