SINGAPORE: Japanese rubber futures edged higher on Friday helped by a softer yen but prices logged a second consecutive weekly decline amid a subdued global demand outlook.

The May Osaka Exchange (OSE) rubber contract closed up 1.1 yen, or 0.3%, at 367.0 yen ($2.34) per kg, although it fell 0.65% for the week. The May rubber contract on the Shanghai Futures Exchange (SHFE) dipped 45 yuan, or 0.25%, to 17,660 yuan ($2,420.11) per metric ton. The contract lost 4.27% this week.

The yen on Friday weakened to a five-month low of 157.93 per dollar, as it continues to remain under pressure from the Bank of Japan’s reluctance to further raise rates. A weaker Japanese currency makes yen-denominated assets more affordable to overseas buyers. Japan’s Nikkei rose 0.2% on Friday and is up a whopping 16% for the year, in part due to the weakness in the yen, which has depreciated 12% in 2024.

Oil prices fell on worries about demand growth in 2025, especially in top crude importer China, putting global oil benchmarks on track to end the week down more than 2%.

Natural rubber often takes direction from oil prices as it competes for market share with synthetic rubber, which is made from crude oil. China, the world’s top consumer of rubber, left its benchmark lending rates unchanged as expected at the monthly fixing on Friday. Persistent deflationary pressure and tepid credit demand call for more stimulus to aid China’s economy, but narrowing interest margins and a weakening yuan limit the scope for immediate monetary easing by Beijing.

The front-month January rubber contract on Singapore Exchange’s SICOM platform last traded at 190.0 US cents per kg, up 0.3%.