SINGAPORE: Japanese rubber futures inched higher on Monday, tracking stronger domestic equities and supported by a weaker yen, although gains were capped by losses in the Shanghai market.

The Osaka Exchange rubber contract for July delivery was up 0.2 yen, or 0.1%, at 226.5 yen ($1.72) per kg as of 0240 GMT.

The rubber contract on the Shanghai futures exchange for May delivery was down 40 yuan, or 0.3%, at 12,665 yuan ($1,868) per tonne.

Rubber inventories in warehouses monitored by the Shanghai Futures Exchange rose 0.8% from a week earlier, the exchange said on Friday.

Japan’s benchmark Nikkei share average opened up 0.93%.

The yen weakened to a three-week low of 132.60 per dollar, and was last fetching 132.07, down about 0.7%.

A weaker yen makes yen-denominated assets more affordable when purchased in other currencies.

Rubber markets are waiting for signs of a demand pick-up in top buyer China following the week-long Lunar New Year holiday, and after the country lifted its strict COVID-19 curbs at the end of 2022.

China’s policymakers plan to show more support for domestic demand this year but are likely to stop short of splashing out big on direct consumer subsidies, keeping their focus mainly on investment, three sources close to policy discussions said.

Asian shares slipped on Monday after a run of upbeat economic data from the United States and globally lessened the risk of recession, but also suggested interest rates would have to rise further and stay up for longer.

The front-month rubber contract on Singapore Exchange’s SICOMplatform for March delivery last traded at 139.8 U.S. cents per kg, down 0.6%.