SINGAPORE: Japanese rubber futures held steady on Thursday, hovering around a near three-month low, as traders weighed the prospect of heightened trade tensions surrounding top consumer China against a softer yen.
The April Osaka Exchange (OSE) rubber contract ended flat at 344.0 yen ($2.21) per kg, its weakest closing since Aug. 23. The January rubber contract on the Shanghai Futures Exchange (SHFE) closed down 215 yuan, or 1.21%, at 17,620 yuan ($2,433.16) per metric ton.
“Demand prospects for natural rubber remain clouded as market participants await further cues on US trade policies under the Trump administration,” said Jom Jacob, chief analyst at Indian analysis firm What Next Rubber.
Traders and auto-tyre companies are likely to slow their building of inventories in view of potential damage from Trump’s proposed tariffs, added Jacob.
Trump has vowed to adopt a blanket 60% tariff on US imports of Chinese goods and his early personnel choices include several hawkish voices on China in senior positions.
Outgoing US President Joe Biden will meet his Chinese counterpart Xi Jinping for likely the final time on Saturday, as Beijing prepares for a potentially more confrontational period under Trump. The US dollar climbed above 156 yen for the first time since July. A weaker Japanese currency makes yen-denominated assets more affordable to overseas buyers.
Comments