EMISSIONS: 2024 EU ETS TNAC Rises, MSR Higher Than Market Expectation
EU ETS TNAC in 2024 stood at 1,148mn EUAs, up 3.27% y/y and between market expectations, while the auction volume reduction is higher than expectation, according to the latest data released by EC.
- BNEF and Reuters forecasted that the EU ETS TNAC in 2024 will be at 1,013mn and 1,156mn respectively, with the reported TNAC in 2024 laying in between, according to their latest estimations.
- MSR will reduce auction volume between September 2025 and August 2026 around 276mn EUAs, higher than market expectation.
- BNEF, Reuters and Veyt forecasted that the MSR intake between September 2025 and August 2026 will be at 271mn, 270.5mn and 266mn EUAs, respectively.
- Previous EC data released on April showed that 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.
- BNEF forecasts that the EUAs to average €73 in 2025, then steadily rise to €147 and €185 in 2030 and 2035 respectively, its latest model showed.
- EUA DEC 25 up 0.43% at 72.07 EUR/t CO2e
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OPTIONS: Larger FX Option Pipeline
- EUR/USD: Apr30 $1.1375-95(E2.4bln); May01 $1.1270(E1.1bln), $1.1500(E1.0bln)
- USD/JPY: Apr30 Y140.50($1.7bln), Y142.00($1.7bln), Y145.00($1.5bln); May01 Y143.00($1.2bln); Y147.50($1.2bln)
- AUD/USD: Apr30 $0.6115(A$1.1bln)
TARIFFS: Bessent Touts "Substantial Movement" In Trade Talks
US Treasury Secretary Scott Bessent has issued a statement on social media touting "substantive movement" towards trade deals with India, South Korea, and Japan.
- Bessent: "We are continuing to make substantive movement on negotiations with many of our trading partners. The negotiations with our Asian trading partners are going very well; the negotiations with the Republic of Korea have gone very well; [Vice President JD Vance's] negotiations with India went very well; and I think we've had some very substantial negotiations with our Japanese allies."
- In an interview with CNBC earlier today, Bessent indicated that the Trump administration is working on a standardised template for trade deals, but declined to disclose further details.
- If progress is seen to be made, the template to facilitate further delays to the implementation of 'reciprocal tariffs', scheduled to take effect in July, as comprehensive bilateral trade deals can involve years of negotiations.
- Bloomberg reported earlier that South Korea's Vice Industry Minister Park Sung-taek said Seoul will send a delegation to Washington this week for “working-level talks to follow up on last week’s progress," but agreeing to any package of measures before the June 3 presidential election is “theoretically impossible.”
- Reuters reported that Japan's top trade negotiator Ryosei Akazawa said Tokyo's position 'has not changed' and Japan will continue to demand the full removal of US tariffs in a second round of negotiations scheduled for this week.
US 10YR FUTURE TECHS: (M5) Corrective Cycle Remains In Play
- RES 4: 113-04 76.4% retracement of the Apr 7 - 11 bear leg
- RES 3: 112-12 61.8% retracement of the Apr 7 - 11 bear leg
- RES 2: 111-25 50.0% retracement of the Apr 7 - 11 bear leg
- RES 1: 111-24 High Apr 28
- PRICE: 111-23+ @ 16:57 BST Apr 28
- SUP 1: 110-16+/109-08 Low Apr 22 / 11 and the bear trigger
- SUP 2: 108-26+ 76.4% retracement of the Jan 13 - Apr 7 bull cycle
- SUP 3: 108-21 Low Feb 19
- SUP 4: 108-03+ Low Dec 12 ‘24 and a key support
Treasury futures are trading closer to their recent highs. Recent gains are considered corrective and resistance to watch is 111-25, 50.0% of the Apr 7 - 11 bear leg sell-off. Clearance of this level would undermine the bearish theme, and open 112.12, the 61.8% retracement point. On the downside, a resumption of weakness would refocus attention on 109-08, the Apr 11 low and the bear trigger. Clearance of this level would resume the downtrend.
