SINGAPORE: Japanese rubber futures declined on Thursday, weighed down by soft economic data from top consumer China and a stronger yen, although higher oil prices capped losses.

The Osaka Exchange (OSE) rubber contract for January delivery closed down 3.8 yen, or 1.21%, at 311.3 yen ($2.08) per kg. The September rubber contract on the Shanghai Futures Exchange (SHFE) rose 110 yuan, or 0.78%, to 14,260 yuan ($1,970.51) per metric ton. Hopes of further Chinese stimulus measures targeting consumer spending are supporting sentiment, said Jom Jacob, chief analyst at Indian analysis firm What Next Rubber. However, concerns over weak Chinese manufacturing following fresh data is capping gains, added Jacob. China’s sluggish manufacturing sector is poised for a “cruel summer” with two sentiment surveys this week pointing to a new level of gloom among factory owners struggling with poor demand, signalling risks for economic growth in the second half of 2024.

Still, China has the ability and confidence to achieve its full-year growth target of around 5% and will work to actively expand domestic demand, state planner officials said. The yen surged nearly 1% to 148.51 per dollar, its highest since mid-March, before settling at 149.95, in the wake of a hawkish pivot from the Bank of Japan. A stronger currency makes yen-denominated assets less affordable to overseas buyers.