Rubber prices rose on Wednesday morning (26/07) as the Japanese yen weakened against the US dollar. The price of rubber (December 2017 delivery, the most-active contract on the Tokyo Commodity Exchange, or Tocom), had gained 1.04 percent, or 2.2 points, to 213.70 yen per kilogram (kg) by 10:26 am local Jakarta time, after opening sideways at the level of 211.50 yen per kg. Yesterday, rubber prices climbed 1.05 percent.
As reported by Bloomberg, the strengthening of rubber prices on Wednesday (26/07) occurs following the weakening of Japan's yen exchange rate, thus increasing investor interest for rubber. Kazuhiko Saito, analyst at Fujitomi, said the weakening of the yen is the key support for rubber prices today.
"Efforts by major rubber exporting countries to increase prices also encourage rubber prices," he added.
The yen was down 0.07 percent, or 0.08 points, to 111.97 yen per US dollar by 10:39 am local Jakarta time.
Rubber Futures (December 2017 Contract at TOCOM):
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¹ 10:26 am local Jakarta time
Source: Bisnis Indonesia
Meanwhile, the projected decline in US oil reserves has been heating up prices. After breaking through the USD $48 per barrel level, the nearest bullish target is now the USD $49.50 per barrel level. By 10:20 am local Jakarta time on Wednesday (26/07), West Texas Intermediate (WTI) had risen 0.97 percent to USD $48.35 a barrel (September 2017 contract), the highest level since 6 June 2017. However, regarding the year-to-date performance the price is still down around 10 percent.
A report from the American Petroleum Institute (API) notes that US oil stocks were down by 10.2 million barrels at Friday (21/07). The official data will be released later today by the US Energy Information Administration (EIA).