Price of Rubber Closed Down More than 2%

Rubber prices plunged more than two percent in late trading today, Wednesday (14/2/2018), ahead of the Chinese New Year holiday.

Rubber for July 2018 at Tokyo Commodity Exchange (Tocom), closed down 2.64% or 5 points at 184.30 yen per kilogram (kg).

Previously, the July rubber contract price opened with a 0.48% decline or 0.90 points at 188.40, after posting a rebound despite a slight increase of 0.05% or 0.1 point at 189.30 at the end of trading Tuesday 13/2).

According to Kazuhiko Saito, an analyst at Fujitomi brokerage in Tokyo, the weakening of rubber prices today was driven by investors selling ahead of the Chinese New Year holiday.

"In addition, there are concerns about rising rubber stocks," Saito continued, as quoted by Bloomberg.

China's rubber reserves monitored by the Shanghai Futures Exchange increased 1.3% last week to 432,050 tons, the 11th straight week of gains.

Also pressing the price of rubber, the yen continued to appreciate 0.61% or 0.66 points to 107.16 per dollar at 13.50 WIB. On Tuesday (13/2), the yen ended up 0.77% or 0.84 points at 107.82 position.

The yen appreciated against the US dollar on a third day in a row to its strongest level in 15 months ahead of the release of US inflation reports later in the day.

In line with rubber, Japan's Nikkei 225 index is also under pressure with the ending down 0.43% or 90.51 points at 21,154.17 level in today's trading.

Meanwhile, the WTI oil price continued to fall 0.02% or 0.01 point to US $ 59.18 per barrel at 13.42 WIB, after ending down 0.17% or 0.10 point at 59.19 position in trading Tuesday (13/2).