The price of gold has strengthened yesterday against the background of a weakening dollar. It is worth noting the low reduction potential that is limited by the cost of gold production near $ 1100 per troy ounce. At the same time a negative for gold remains low demand for the metal from major consumers in China and India. This situation is explained by the growth of the US currency. It is noteworthy that analysts expected increased demand in Q4 in Asia, but experts' forecasts have not been met. Demand from investment funds also remains weak due to record levels of stock indexes in the US. We expect the resumption of purchases of gold in the medium term, but in the near future we can see a continuation of price reduction.
The price of oil continues to be near four-year low. The main reasons for the decline of oil quotations, which fell by almost 30% since June are forecasts on the slowdown in global growth and weak demand from European and Asian consumers amid rising supply of oil on the world markets. Falling oil prices may stop the reduction of quotas on imports of oil in OPEC countries, which produce about 40% of the world's oil. On November 27 will be held a meeting of OPEC in Vienna, but we expect that the quota will not be lowered and the quotations will continue a gradual decline. We recommend holding short positions and maintain a medium-term negative outlook on oil.