Oil price gained more than 2% in Asian morning after closing at 46.28 last week. There's some 'good' news for crude oil. First, OPEC will be meeting on Dec 17 and members are expected to agree on an output cut of at least 2M bpd. This represents reduction of oil output by 7.3%. On Sunday, Iran's oil minister said that real price of crude oil should be above $100, over 100% upside from Friday's close. Second, market speculates that US' auto industry will be rescued finally as the White House said it might use part of the US$700B bailout fund to help the 3 auto giants.

Asian equity market also gained because of auto rescue plan. The MSCI Asia Pacific Index gained 3.1% on Monday morning. Japan's Nikkei 225 Stock Average surged more than 4% with Toyota Motor advanced over 3%.

Gold price rose 1.1% in Asian morning after settling at 820.5 last Friday. Over the last week, gold price rose 9.1%. Near-term outlook for gold is bullish as USD weakens. The dollar index plunged 3.9% last week. Technically, it should continue to drop and critical support is at 83.11. The Fed is expected to cut its policy rate by 50 bps to 0.5% on Dec 16. This is the lowest level in 50 years. Against the Euro, the greenback fell 0.65% to 1.3454 on Monday morning. In early December, the ECB cut interest rate to 2.5% which is expected to trough at 1.75 in 2009. The interest rate differential made the dollar weakens recently.

US' budget deficit rose to US$401.6B in October and November because of the Government's bailout plan to the financial system. Economists expect the situation to worsen in 2009 when the Government fully spends the TARP.