Aug. 7 (Bloomberg) — Rubber dropped as much as 2.5 percent, booking its first weekly decline in five weeks, on speculation a U.S. jobs report may revive concern that worsening unemployment will curb consumer spending and cap demand for the commodity.

Futures in Tokyo declined for a second day in three, retreating further from a nine-month high reached Aug. 4. The Labor Department’s report on unemployment is forecast to show an increase to the highest level since 1983.

“Investors were cutting long positions of rubber futures as they brace for bad U.S. data,” Hisaaki Tasaka, an analyst at Tokyo-based commodity broker ACE Koeki Co., said today by phone. A long, or buy, position is a bet on prices rising.

January-delivery rubber fell as much as 4.8 yen to 191 yen a kilogram ($2,003 a metric ton) on the Tokyo Commodity Exchange before settling at 191.9 yen. Prices fell 1.8 percent this week, the steepest decline since the week ended June 19.

Economists in a Bloomberg survey estimate that a Labor Department report today will show unemployment rose to 9.6 percent. The number of Americans filing claims for jobless benefits last week fell more than economists predicted, according to data released yesterday, a sign some employers have stopped paring staff.

“The rate of deterioration in unemployment is likely to ease, but there are doubts we’ll see as much improvement as the market would like,” said Kazuhiro Takahashi, a general manager at Daiwa Securities SMBC in Tokyo.

Rubber futures gained 21 percent last month, the best performance since December 2006, amid speculation the worst of the global recession has passed and consumption of the commodity used to make car tires will recover.

Rubber for January delivery on the Shanghai Futures Exchange, the most-active contract, lost 0.5 percent to 18,665 yuan ($2,732) a ton.

Source: Bloomberg

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