SINGAPORE: Japanese rubber futures hit a 13-year peak on Tuesday as economic stimulus unveiled by China boosted demand prospects in the world’s largest rubber consumer.

Asian stocks hit their highest in more than two and half years, heartened by broad stimulus measures from China while expectations for more US rate cuts kept risk sentiment aloft and the dollar under pressure. The Osaka Exchange (OSE) rubber contract for February delivery ended nearly 5% higher, at 385 yen ($2.66) per kg.

The market hit its highest level since August 2011 at 386.6 yuan. The rubber contract on the Shanghai Futures Exchange (SHFE) for January delivery closed up 715 yuan, or 4.09%, to 18,215 yuan ($2,588.24) per metric ton. The most active October butadiene rubber contract on the SHFE ended up 400 yuan, or 2.59%, to 15,865 yuan per metric ton.

“A slew of policy measures announced by the People Bank of China cheered investor sentiment and risk appetite in the broader Asian equities and commodities,” said Jom Jacob, chief analyst at Indian analysis firm What Next Rubber.

“It is widely perceived that a faster economic recovery in China can contribute to the demand prospects for natural rubber.” The price of Thailand’s benchmark export-grade smoked rubber sheet (RSS3) and block rubber were down 1.56% and 0.74%, to stand at 91.46 baht($2.77) and 67.23 baht($2.04), respectively. The yen eased 0.36% to 144.12 per dollar after Bank of Japan Governor Kazuo Ueda reiterated in a speech on Tuesday that the central bank can “afford to spend time” scrutinizing developments in markets and overseas economies before tightening policy further.