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Rubber declined for the first time in four days, retreating from a four-month high, as data showed slower-than-estimated growth in U.S. personal incomes and the yen resumed a rally against the dollar.
Futures in Tokyo lost as much as 1.6 percent after yesterday reaching the highest level since April 30. The price is headed for the steepest monthly gain since December 2009.
The Japanese currency resumed its climb, threatening the nation’s export-led recovery, even after the Bank of Japan moved to expand its lending program. U.S. incomes rose 0.2 percent in July, less than the 0.3 percent median estimate of 66 economists surveyed by Bloomberg News.
“Investor appetite for risky assets waned as the U.S. data added to signals for an economic slowdown,” Kazuhiko Saito, an analyst at Tokyo-based broker Fujitomi Co., said today by phone. “Rubber was sold in tandem with stocks and oil.”
February-delivery rubber lost as much as 4.9 yen to 294.6 yen per kilogram ($3,492 a metric ton) before trading at 295.8 yen on the Tokyo Commodity Exchange at 12:07 p.m.
The yen appreciated to 84.39 per dollar from 84.62 in New York yesterday, weakening the appeal of yen-denominated contracts. Stocks and oil declined as the U.S. data heightened concern that the economic recovery may stall.
“People are concerned that the sluggish growth in U.S. personal spending would have a negative impact on the world economy because exports of Japan, China and other Asian countries count on it,” said Fumiyuki Nakanishi, a strategist at Tokyo-based SMBC Friend Securities Co.
Auto-Sales Growth
In the cash market, prices in Thailand, the world’s largest rubber producer, surged 1.4 percent to 107.35 baht ($3.43) per kilogram yesterday, boosted by increasing demand from local and overseas processors following robust car-sales growth, according to the Rubber Research Institute of Thailand. Rains have disrupted tapping, limiting supplies, it said.
The price was also supported by speculation that supply from Indonesia, the second-largest rubber producer, may be disrupted because of the eruption of the Sinabung volcano on Sumatra Island. It erupted on Aug. 29 for the first time in 400 years, spewing ash and volcanic materials and prompting the evacuation of surrounding areas.
“The incident raised uncertainty about supply from Indonesia, although we have not yet heard of any real damage on production or shipments,” Saito at Fujitomi said.
January-delivery rubber on the Shanghai Futures Exchange lost 1 percent to 25,575 yuan ($3,757) a ton at 11:22 a.m. local time. China’s inventories shrank for the first week in five, dropping by 32 tons to 24,701 tons, the exchange said on Aug. 27, based on a survey of 10 warehouses in Shanghai, Shandong, Yunnan, Hainan and Tianjin.
Source: Bloomberg