Wednesday, May 8, 2013

Car sales jumped, so the rubber prices


Car sales in UK jumped by almost 15% in April 2013, compared to April 2012 and 9% higher in the first four months of 2013, which is an encouraging indication for the UK economy. The health of the UK car market stands in sharp contrast to Europe, where sales slumped by more than 10% in March. Despite the buoyant start to the year, car market faces difficult conditions in the coming months as their purchasing power is squeezed by higher inflation and muted wage growth. Companies are also under pressure to contain costs and weak business confidence.

The yen weakened to 99.12 per dollar, nearing to a four year low of 99.95. Rubber inventory in Qingdao, China’s main hub for the commodity rose to a record high, as imports gained while demand remained tepid amid slowing economic growth. China may step up rubber purchases on hopes for demand recovery later this year, hence, may increase imports of the natural rubber to take advantage of low international prices.

Today, RSS4 grade in the domestic spot market will trade with positive note and may close around `.168 a kg. The price of RSS3 grade closed at `.163.54 per kg at Bangkok, while Malaysian SMR 20 closed in red at `.138.32 a kg. On the Tokyo Commodity Exchange, May futures series closed at ¥263.5, June at ¥266.2, July at ¥270, August at ¥272, September at ¥274.6 and the contract for delivery in October at ¥276.6 a kg.

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