Brent crude rebounded after OPEC triggered the biggest one-day plunge in three years yesterday by failing to cut its output in response to a glut.

Brent and West Texas Intermediate headed for their biggest weekly drops since 2011. OPEC will maintain its collective output target at 30 million barrels a day, Saudi Arabia's Oil Minister Ali Al-Naimi said after discussions in Vienna yesterday. The group's policy will ensure a crash in the U.S. shale industry, predicted Leonid Fedun, the vice president of Russia's OAO Lukoil.

"We have a situation where OPEC is prepared to live with low oil prices," said Harry Tchilinguirian, BNP Paribas SA's London-based head of commodity markets strategy. "OPEC is forfeiting its role as a swing supplier to balance the market, and is giving back the role to market mechanism."

Brent for January settlement gained 67 cents, or 0.9 percent, to $73.25 a barrel at 9:34 a.m. New York time on the London-based ICE Futures Europe exchange. The contract dropped $5.17 to $72.58 yesterday, the lowest close since August 2010. Prices are down 8.9 percent this week, heading for the biggest weekly loss since May 2011. Brent has decreased 15 percent this month and 34 percent in 2014.

WTI for January delivery declined $4.25, or 5.8 percent, to $69.44 on the New York Mercantile Exchange, compared with the Nov. 26 close. There was no floor trading yesterday because of the Thanksgiving holiday and transactions from yesterday will be booked today for settlement purposes. Floor trading will close at 1:45 p.m. today. Prices are down 9.3 percent this week, also the most since 2011.

Gold prices fell to a week low amid falling oil prices, inflation threatening. The cost of oil futures had fallen to four-year low after OPEC's decision not to cut production in order to stabilize the market.

"Quotes of precious metals are reduced because cheap oil threatens deflation," - said analyst Victor Tyanpiriya ANZ.

Dollar exchange rate increases relative to the currencies of commodity producers, also preventing increase of quotations of gold.

"Gold is moving in the same direction with the oil, but I think that the fall will stop at at $ 1,180," - said a trader in Tokyo, recalling the referendum in Switzerland on Sunday.

In a referendum would be considered a proposal to ban the country's central bank to sell gold reserves and oblige him to keep at least 20 percent of assets in gold, compared with 8 percent in October. According to a recent survey, the proposal is 38 percent of the Swiss, but if the result of the vote will be positive, the central bank will need in the coming years to buy 1,500 tons of gold, which will cause a rise in prices, experts say.

Gold prices are likely to remain vulnerable in the short term amid signs that the strengthening of the US economic recovery will push the Fed to more rapid and sharp increase in interest rates than expected.

Expectations of growth rates on loans put pressure on gold as a precious metal with difficulty competing with the yield of interest-earning assets at higher rates.

The cost of the December gold futures on the COMEX today fell to 1184.70 dollars per ounce.

Oil prices were under pressure after the decision of the OPEC to leave output on current levels challenging U.S. shale drillers and other higher-cost producers. Overnight, oil prices declined to their lowest in more than four years with Brent dropping the most since 2011. In today's trading session with Brent Crude recovered slightly and is trading +0.59% at USD73.01 a barrel and WTI Crude slumped -6.09% currently quoted at USD69.20. Crude collapsed into a bear market last month amid the highest U.S. output in three decades and signs of slowing global demand growth. A total of 58 percent of respondents in a Bloomberg Intelligence survey this week had forecast no change to the target.

Gold, currently trading at USD1,184.00 a troy ounce again lost. A stronger U.S. dollar and falling oil prices after the OPEC meeting weighed on the precious metal. A stronger dollar makes gold less attractive for buyers and falling oil prices put pressure on gold as it's less attractive as an inflation-hedge. Also traders keep an eye on the Swiss referendum on SNB's gold reserves scheduled for November 30 that would force the central bank to hold at least 20 percent of its assets in gold and store them locally. Last week's polls showed that the majority of voters is against the initiative, only 38% supporting "Save our Swiss gold". If the vote passes it would be likely boosting gold price, if not the precious metal will see further pressure.

GOLD currently trading at USD1,184.00

REUTERS

Japan inflation slows in October, highlights challenge facing Abe

(Reuters) - Japan's annual core consumer inflation slowed for a third straight month in October due to falling oil prices, highlighting the economic gloom facing Premier Shinzo Abe as he campaigns for a new mandate to implement his stalled recovery plan.

"Inflation could continue to slow because oil prices are falling," said Hidenobu Tokuda, senior economist at Mizuho Research Institute. "Other data show the economy is recovering, but this is not really because of Abe's policies."

Source: http://www.reuters.com/article/2014/11/28/us-japan-economy-idUSKCN0JC08Y20141128

BLOOMBERG

Dollar Advances as OPEC Output Freeze Seen Hurting Euro, Aussie

The dollar rose against all 16 of its major peers amid speculation OPEC's decision to keep oil output unchanged will stimulate the U.S. economy while weighing on the euro and commodity currencies.

The yen fell against the dollar for the first time in four days after a government report showed household spending dropped and inflation slowed. The 12-nation Organization of Petroleum Exporting Countries kept its output target at 30 million barrels a day even after the steepest slump in oil prices since the global recession. Australia's dollar declined with the Norwegian krone and Canadian dollar.

Source: http://www.bloomberg.com/news/2014-11-28/dollar-set-for-weekly-gain-on-u-s-outperformance-aussie-falls.html

REUTERS

Rouble hits record low after OPEC keeps output unchanged

Nov 27 (Reuters) - The rouble fell to record lows against the dollar and euro on Thursday after OPEC decided against cutting crude-oil output to boost flagging prices.

At 1710 GMT, the rouble was down around 2.6 percent against the dollar at 48.60 roubles per dollar and around 2.5 percent weaker against the euro at 60.69 roubles per euro.

It had earlier strengthened against both currencies in nervous trade before the OPEC meeting in Vienna, one of the most closely watched in years.

Source: http://www.reuters.com/article/2014/11/27/russia-markets-rouble-idUSL6N0TH0P920141127

(raw materials / closing price /% change)

Light Crude 73.69 -0.54%

Gold 1,196.60 -0.04%