EMISSIONS: BNEF Revised Up Energy Related Emissions By 2050
BNEF revised up energy-related CO2 emissions by 2050 to 26.8bn tons CO2e in its latest outlook, up from 24.4bn tons CO2e a year earlier, supported by a lower gas price outlook and higher data centre power demand, it said.
- Final power demand is forecast at 46,700TWh by 2050, compared with 43,100TWh in the 2024 forecast. This is largely due to data centre demand.
- BNEF also revised down the global EV fleet by 4.3% by 230 and 2.2% by 2050.
- In Europe, energy-related emissions from steel, aluminium, cement, petrochemicals and other industrial materials are now forecast to peak two years earlier in 2027.
- EU emissions from those sectors have been revised down by 33% on the year to reach 237mn tons CO2e by 2050.
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FED: March Economic Projections: Higher Inflation, Weaker Growth, Same Rates
The MNI Markets Team’s expectations for the updated Economic Projections in the March SEP are below.
- The unemployment rate is likely to rise slightly for 2025 alongside a downgrade in GDP growth, while the 2025 core and headline PCE inflation projections are set to rise again. Changes to later years will likely be limited, however.
- More detail on the shift in Fed funds rate medians is in our meeting preview - we will add more color next week.
FED: Market Pricing Nearly 3 2025 Cuts As Conditions Tighten
Amid rising government policy uncertainty, sentiment among businesses and consumers has fallen sharply since the start of the year, while equities and the dollar have reversed their post-election rise. Overall, financial conditions have tightened, even if stress is not yet mounting, e.g. no major widening of credit spreads (the accompanying chart shows the Fed’s financial conditions impulse index but only through January).
- Combined with growth fears, this has affected expectations for the Fed’s rate path, with around 18bp more cuts expected in 2025 compared with what was seen after the January FOMC. 65bp of cuts are priced for the year as a whole. 2025 cut pricing reached 71bp before the February inflation data and 76bp before the February payrolls report.
- A rate cut is seen with near zero probability for March’s meeting, but the first full cut is just about priced for June, with a second nearly priced by September.
- Chair Powell has no reason to endorse or refute these expectations – he’s likely to be happy with a press conference that ends with little discernable change in pricing.
CANADA'S CARNEY ANNOUNCES ELIMINATION OF THE CONSUMER CARBON TAX
- CANADA'S CARNEY ANNOUNCES ELIMINATION OF THE CONSUMER CARBON TAX
