Oil prices struggled

Forex today opened to quiet markets, with a thin calendar in the offering for Monday and holiday markets waiting ahead in the upcoming US session. The Japanese Yen took a break in early Monday action, retreating modestly to allow the broader market to reclaim recently-lost ground.

In the EU, focus remains on Italian budget loggerheads, and as the German-Italian bond yield spread continues to widen, and EUR/USD falls below 1.1300, the former double-bottom, on USD strength.

Brexit woes continue to plague the Pound, and despite managing to close a bearish gap to kick off the week, the GBP/USD is primed for a continuation of last week’s declines, losing the 1.2900 key technical level heading into Monday’s action.

Taking some pressure off a sharp drop in oil prices last week, Saudi Arabia’s energy minister said on Sunday that Riyadh plans to reduce its oil supply to world markets by 500,000 barrels per day in December, a global reduction of about 0.5 percent. That helped to lift oil prices on Monday, with U.S. crude rising to $60.84 a barrel and Brent crude to $71.12 per barrel.

However, Saudi Arabia’s supply cut may prove to be a temporary solution to falling prices as global growth slows, with two of the world’s biggest economies – Germany and Japan – expected to report a contraction in output in coming days.

Gold prices were little changed on Monday while the dollar inched up as traders awaited the U.S. inflation data due later this week. Interest rate increases, and higher U.S. bond yields are usually bearish for gold, which offers no yield. They also tend to boost the dollar, in which gold is priced. As a result, with stronger dollar, dollar-denominated assets, like gold, could be more expensive to potential buyers holding other currencies.