SINGAPORE: Japanese rubber futures inched lower on Wednesday after a five-session rally, as investors weighed weaker physical rubber prices and disappointing Chinese economic data against firmer oil prices.
The Osaka Exchange (OSE) rubber contract for January delivery was down 1 yen, or 0.31%, at 322.3 yen ($2.20) per kg as of 0155 GMT.
The January rubber contract on the Shanghai Futures Exchange (SHFE) fell 145 yuan, or 0.91%, to 15,870 yuan ($2,218.59) per metric ton.
The price of Thailand’s benchmark export-grade smoked rubber sheet (RSS3) <RUB-RSS3C-BKK> was down 1.26% to 85.33 baht ($2.44).
In top consumer China, bank lending tumbled more than expected in July, hitting the lowest in nearly 15 years, dragged down by tepid credit demand and seasonal factors, and raising expectations that the central bank may dole out more easing steps.
The country’s economic growth missed forecasts in the second quarter, while July economic indicators also offered little respite as export growth slowed and consumer inflation got a boost only due to weather disruptions to food supplies.
Oil prices climbed on Wednesday on estimates about shrinking U.S. crude and gasoline inventories as the market watched for a possible widening of the Middle Eastern war, which could curtail global oil supplies.
Natural rubber often takes direction from oil prices as it competes for market share with synthetic rubber, which is made from crude oil.
The dollar was stable at 147.06 yen, continuing to consolidate around the 147 level this week, as a benign reading for U.S. producer prices reinforced bets on interest rate cuts this year.
A stronger Japanese currency makes yen-denominated assets lessaffordable to overseas buyers.
The front-month September rubber contract on Singapore Exchange’s SICOM platform last traded at 171.5 U.S.