EMISSIONS: EU End of Day Carbon Summary: EUAs/UKAs Fall W/W Amid US Tariffs
Apr-04 15:27
EUAs/UKAs Dec25 declined by nearly 8% and 2%, the lowest level since mid-Oct 2024 and mid-Mar 2025 respectively, with China announcing retaliatory tariffs on the US. The spread between EUAs-UKAs narrowed to the lowest level since June 2024 amid greater EUAs losses, while EU-UK ETS relink talk capping UKAs losses.
- EUA DEC 25 down 3.5% at 63.74 EUR/MT
- ICE UKA Dec25 down 0% at 45.46 GBP/MT
- TTF Gas MAY 25 down 7.4% at 36.315 EUR/MWh
- The EUA Dec25 premium to the UK equivalent narrowed to €12.34/t CO2e from the €13.2/t CO2e in the previous day, amid greater EUAs decline.
- The latest Germany ETS CAP3 auction cleared at €63.8/ton CO2e, down 5.29% compared with the previous Germany auction at €67.36/ton CO2e.
- EUAs Relative Strength Index (RSI) is trending down to one-month low and have breached the lower Bollinger Band (BOLL), both signalling oversold market conditions.
- Verified emissions under the EU ETS fell by 5% in 2024, reaching approximately 50% below 2005 levels, driven by a decline in power sector emissions, according to EU Commission data. The result in line with market expectations.
- Growing trade tensions between the EU and US, along with the bloc’s shift toward defence, may drive the use of the EU ETS as a funding mechanism for tariff retaliation.
- Italy's Industry Minister Adolfo Urso on Thursday told parliament that he would ask the EU to immediately suspend Green Deal.
- The Norwegian government plans to propose a 70-75% emissions reduction target by 2035 versus 1990 levels in the next Nationally Determined Contributions (NDC), advancing from the previous NDC released in 2022 of a 55% reduction by 2030.
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OPTIONS: Expiries for Mar06 NY cut 1000ET (Source DTCC)
Mar-05 15:26
- EUR/USD: $1.0500(€1.8bln), $1.0550(€973mln), $1.0580-00(€1.5bln), $1.0625-30(€855mln), $1.0700-10(€844mln), $1.0845-50(€2.3bln)
- USD/JPY: Y148.00($786mln), Y149.00($511mln), Y149.70-85($620mln)
- USD/CAD: C$1.4400($802mln)
- USD/CNY: Cny7.2000($1.3bln), Cny7.2800($1.4bln)
GILTS: Lower Following U.S. ISM Data, Key Support In Futures Pierced
Mar-05 15:24
Gilts sell off again following the U.S. ISM services survey.
- Key support at 91.79 pierced as the contract bases at 91.74, before recovering to ~91.80. Fresh extension lower would target Fibonacci support at 91.27.
- Yields 8-14bp higher, 10s lead the move, with the next point of upside interest in that benchmark located at the Jan 20 high (4.704%).
STIR: ISM Services Unwinds Dovish ADP Employment Move
Mar-05 15:21
The dovish ADP employment move fades in the wake the higher-than-expected ISM services survey (with both the headline reading and major components topping expectations).
- Fed Funds now price 73.5bp of cuts through December vs. 80.5bp ahead of the data.
- 12bp of cuts priced through May and 29bp showing through June, compared to 14bp & 32bp pre-data.
- Ongoing signs of sticky services inflation present continued background worry for the Fed, but markets have become more attuned to downside economic growth risks in recent weeks.
