Currently trading at 75.9, WTI crude oil stays strong after surging +1.4% and closing above 75 (yesterday's close: 75.18) Wednesday. While weakness in USD was certainly a major driving force, better-than-expected inventory report from the industry-sponsored API further boosted speculations on improvement in energy demand.

API reported that crude oil inventory dropped -0.17 mmb, compared with market expectation of an increase of +1.02 mmb, to 339.2 mmb in the week ended October 9. Gasoline stockpile also drew -2.66 mmb as demand increased while imports fell. For distillate, stockpile added +0.22 mmb as demand declined.

Investors viewed the report as supportive and draws were seen in both crude and gasoline inventories. The US Energy Department will probably show another picture with builds in both crude and gasoline while draw in distillate.

Comex gold pulled back after rising to 1072 Wednesday as the relentless rally in recent weeks has brought the precious metal to overbought territory. Today in Asia, gold makes little change after settling flat at 1064.7 yesterday. However, USD's weakness will help resume gold's uptrend in the long-term.

USD tumbled yesterday as stock market advanced on good earnings. Moreover, decline in US retail sales in September was less severe than market forecast. The headline reading contracted -1.5% mom during the month following a +2.2% gain in August. The market has anticipated a decline of -2.1%. Excluding auto sales, the reading indeed rose +0.5%, suggesting the contraction had been driven by completion of the 'cash for clunkers' program.

The dollar plummeted and was pressured the most against the Australian dollar (-0.9%) and New Zealand dollar (-0.7%). RBA Governor Glenn Stevens said that the central bank cannot be 'too timid' to increase interest rate as the 'threat' of economic crisis has passed. This indicated further tightening on the way after the October's rate hike. On the contrary, at the FOMC minutes for September, the Fed signaled that the policy rate would stay low for an extended period. While delivering a better economic outlook, policymakers remained cautious and some members even saw the need to increase the size of MBS purchase program so as to stimulate growth. Although the Fed eventually decided to make no change on policy at the meeting, the overhang of further easing is still there.