Feb. 18 (Bloomberg) -- Rubber rose from the largest weekly loss since November as Japan’s currency weakened, boosting the appeal of yen-denominated contracts amid declining output of the commodity during a low production season.
The contract for July delivery gained 0.9 percent to close at 324.2 yen a kilogram ($3,448 a metric ton) on the Tokyo Commodity Exchange. Futures fell 2.7 percent last week, the most since the week through Nov. 9.
Asian stocks rose as the yen dropped after the Group of 20 nations refrained from censuring Japan’s currency policy, while signaling that the country has scope to keep stimulating its stagnant economy as long as policy makers cease publicly advocating a sliding yen.
“The weakening yen is supportive to rubber markets,” Chaiwat Muenmee, an analyst at DS Futures Co., said by phone from Bangkok. Chinese buyers may increase purchases after returning from Lunar New Year holidays last week, he said.
The contract for September delivery on the Shanghai Futures Exchange lost 1.9 percent to close at 26,215 yuan ($4,201) a ton as trade resumed.
Thai rubber free-on-board was unchanged at 97.45 baht ($3.26) a kilogram today, according to the Rubber Research Institute of Thailand. Output in the country’s southern provinces, the main production area, is expected to decline in the next few weeks, which will accelerate purchases, the institute said on its website.
Thailand has spent 22 billion baht buying 198,000 tons from farmers above market rates to boost local prices, Yuttapong Charasathien, deputy farm minister, said last week. The National Rubber Policy Committee approved spending a further 5 billion baht and has no immediate plan to sell stockpiles, he said.
--Editors: Jarrett Banks, Brett Miller