ACCORDING to Bloomberg, rubber fell to the lowest level in six weeks amidst speculations that the US Federal Government shutdown will weaken the demand for rubber used in tyres.
Reportedly, the contract for March delivery on the Tokyo Commodity Exchange fell 1.8% to 260.9 yen per kg (US$2,663/metric tonne), the lowest settlement since Aug. 21. Futures advanced rose 12% last quarter, the most since the period through December.
The US government has partially shutdown after lawmakers failed to reach an agreement on the fiscal year budget, and specifically raising disagreements over changes to the healthcare law. The deadlock, experts speculate, could weaken the demand for the commodity.
Meanwhile, the report says that the Rubber Research Institute of Thailand cited the Thai rubber free-on-board falling for a fifth day, and losing 1.2% to 79.55 baht (US$2.55) a kg.