TOKYO (Feb 2): Benchmark Tokyo rubber futures fell for a third straight session on Thursday to end down 1.7%, hurt by a stronger yen, after having touched their highest level in more than five years earlier this week.

Tokyo Commodity Exchange (TOCOM) futures, which set the tone for tyre rubber prices in Southeast Asia, have been on a roller coaster in the past week as supply concerns after floods in Thailand were offset by news of the bourse's investigation into rubber positions.

"TOCOM has not gained stability, but today, it seems as though the participants were not active ahead of the return of Chinese markets from tomorrow," said a Tokyo-based broker.

Chinese markets will reopen on Friday after the week-long Lunar New Year holidays.

The US dollar has weakened to around 112.86 yen from around 113.26 yen on Wednesday afternoon, reflecting mounting concerns that the United States was poised to ditch a two decade-old "strong dollar" policy.

The Tokyo Commodity Exchange rubber contract for July delivery finished 5.4 yen lower at 310.1 yen (US$2.75) per kg. The benchmark has fallen 11.8% in the past three sessions after hitting its highest since September 2011 on Monday.

Crude rubber inventories at Japanese ports stood at 5,126 tonnes as of Jan 20, down 4.2% from the last inventory date, data from the Rubber Trade Association of Japan showed on Thursday.

The front-month rubber contract on Singapore's SICOM exchange for March delivery last traded at 225 US cents per kg, down 4 US cents.

(US$1 = 112.6700 yen)