Jan. 30 (Bloomberg) -- Rubber in Tokyo declined as Japan’s currency advanced against the dollar, reducing the appeal of yen-denominated futures, after the Federal Reserve cut the pace of bond buying.
The contract for delivery in July fell 1.9 percent to 228 yen a kilogram ($2,227 a metric ton) on the Tokyo Commodity Exchange. That’s near Jan. 28’s settlement price of 226.7 yen, which was the the lowest since September 2012. Futures have lost 17 percent in January.
The yen advanced to 102.08 per dollar, nearing a one-month high of 101.77 reached Jan. 27. The Federal Open Market Committee said it will trim monthly bond purchases by $10 billion to $65 billion, citing labor-market improvement and economic growth that has picked up in recent quarters. Asian stocks extended a global sell-off amid concerns the Fed’s tapering may worsen a slowdown in emerging economies.
“A drop in global stocks boosted investor appetite for the yen as a haven, leading to sales of futures in Tokyo,” said Hideshi Matsunaga, an analyst at broker Evolution Japan Co.
Slowing economic growth and rising stockpiles in China signaled weakening demand from the largest consumer of the commodity used in tires.
Rubber for May delivery on the Shanghai Futures Exchange dropped 1 percent to 15,480 yuan ($2,555) a ton. The most-active contract is trading at the lowest since July 2009.
Rubber free-on-board at Songkhla, Thailand, fell 1.4 percent to 71.25 baht ($2.16) a kilogram today, according to the Rubber Research Institute of Thailand.
--With assistance from Supunnabul Suwannakij in Bangkok. Editors: Brett Miller, Thomas Kutty Abraham