SINGAPORE: Japanese rubber futures edged higher on Wednesday, lifted by gains in the Shanghai market and a weaker yen, as sentiment remains mixed over easing COVID-19 curbs in top buyer China amid the country’s latest surge in cases.

The Osaka Exchange’s rubber contract for May delivery was up 1.4 yen, or 0.6%, at 224.5 yen ($1.70) per kg as of 0215 GMT.

The rubber contract on the Shanghai futures exchange for May delivery was up 90 yuan, or 0.7%, at 12,800 yuan ($1,837) per tonne. Japan’s benchmark Nikkei share average opened down 0.08%.

Japan will pay close attention to the COVID-19 situation in China, in addition to risks from a global economic slowdown, price hikes and supply constraints, according to its monthly report for December. Hopes have grown in recent weeks that rubber demand in top buyer China would improve as more cities relax COVID-19 restrictions that have limited industrial activity and consumption.

Mainland China’s Health Commission reported 3,101 new symptomatic coronavirus cases for Dec. 20, compared with 2,722 new cases a day earlier.

The yen was last 0.26% weaker at 132.06 per dollar, but stayed not far off the four month high of 130.58 per dollar that it touched the previous day.

A weaker Japanese currency makes yen-denominated assets more affordable when purchased in other units.

US stocks closed higher on Tuesday in a modest reversal of a four-day sell-off, but the greenback lost altitude and bond yields jumped in the wake of an unexpected policy pivot from the Bank of Japan (BOJ).

The front-month rubber contract on Singapore Exchange’s SICOM platform for January delivery last traded at 133.0 US cents per kg, up 0.8%.