Key Tokyo rubber futures hit a five-week high on Monday, helped by a jump in oil prices and a pause in the yen's strengthening against the dollar. The key Tokyo Commodity Exchange rubber contract for January delivery rose 6.8 yen or 2.5 percent to settle at 279.5 yen per kg. It rose to a five-week high of 280.0 yen earlier, the highest for any benchmark since June 29.
The dollar index hit a three-month low on Monday, hurt by worries that the US economy's recovery is losing steam, while the high-yielding Australian dollar reached a three-month high, buoyed by a rise in Asian equities. The dollar was up 0.4 percent after hitting an eight-month low of 85.95 yen on Friday.
Tokyo rubber futures are forecast to hold at relatively firm levels in the next two months because of strong Asian demand, even though trade in the United States and Europe will slow because of summer holidays, a Reuters poll showed.
Honda Motor Co and Renault joined their rivals in reporting strong results for the quarter to the end of June, as the auto industry faces growing concerns over slowing demand in the United States, China and Europe. Rubber inventories in warehouses monitored by the Shanghai Futures Exchange rose 3.6 percent from a week earlier, the exchange said on Friday.
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