OPEC keeps its output ceiling unchanged; oil collapses

     OPEC keeps its output ceiling unchanged; oil collapses

–    Since they are already producing more than that, it means no end to oversupply

•     CAD, AUD, NOK, RUB and NZD are most correlated with oil prices

–    Those are the currencies most likely to suffer as oil prices fall further

•     Lower oil means lower inflation = headache for ECB

–    German and French bond yields hit record low

–    Euro to fall further as ECB struggles to fight off deflation, in my view

•     Japan’s inflation, retail sales fall in October

–    Shows difficulty of getting higher inflation to stimulate increased consumption

–    But industrial production rises – due to higher exports? That would be a success for strategy of depreciating yen. Look for further JPY weakness

•     Lower inflation = less need for gold

–    Latest polls show Sunday’s Swiss referendum will fail = gold to fall further

•     Today:

–    Eurozone: CPI for November expected to slow further = EUR-negative

–    Canada:  Sep GDP expected to accelerate but Q3 GDP slow = CAD-negative