ECB: EPP Pushing To Further Delay ETS2 Until 2030
European People's Party (EPP), the largest party in the EU Parliament, is pushing to further delay the EU ETS until 2030, following the Environmental Council announcing yesterday that the system will be postponed by one year to 2028.
- A reminder that ETS2 timings and potential delays should mechanically feed through to EUR inflation swap pricing. After highlighting a lack of movement yesterday following news of a likely delay to 2028, we note that the 2s3s EUR inflation swap has since steepened ~2bps to 3bps at typing (prices according to BGN).
- From Bloomberg’s write-up of the EPP news: “ ‘There’s heated discussion about ETS2 among our members, with majority of them convinced that consumers cannot bear the costs of the transformation…We’ll be seeking even further delay, at least three years’ Andrzej Halicki, vice-chair of the EPP group in the parliament, told reporters.”
- The EU parliament is expected to hold a plenary vote on its position on the bloc’s 2040 climate target proposal during the 12-13 Nov session.
- Wopke Hoekstra said that the one-year delay of EU ETS 2 is now part of the 2040 climate target text pending for the EU Parliament’s approval.
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FINLAND: Stubb & Orpo To Meet w/Trump 9 Oct To Press Ukraine Support
President Alexander Stubb has said that he intends to deliver messages from Ukraine to US President Donald Trump on Thursday, 9 October. Stubb has recently visited Kyiv for walks with his Ukrainian counterpart, Volodymyr Zelenskyy, and he will be in Washington, D.C., for talks at the White House alongside Prime Minister Petteri Orpo. The Finnish gov't says the meeting "will focus on bilateral relations between Finland and the United States, commercial and economic cooperation and Russia's war of aggression in Ukraine."
- Stubb has proved one of the European leaders most able to communicate effectively with President Trump during the latter's second term in office. Speaking in Kyiv, Stubb talked up one of Trump's recent European annoyances, namely the continued purchase of Russian hydrocarbons: "As far as getting our own house in order, I think President Trump, when he says that Europe needs to stop buying Russian oil and gas, is right.[...] the finger points in two places [referring to Hungary and Slovakia],"
- Helsingin Sanomat reports that the issue of US purchase of Finnish-made icebreaker vessels is also set to be on the agenda, although the gov't has not confirmed this. Orpo: "We have a lot to give. We have the ability to build icebreakers. We have that expertise. We are ready to discuss these issues.” Such an order would not only provide a notable boost to the shipyards in Helsinki and Rauma, but also bolster security ties between the US and Finland, seen as increasingly important now the country is in NATO and holds a border with Russia hundreds of miles long.
PIPELINE: Corporate Bond Update: $2.5B BoE, $1.75B CPPIB Debt Priced
- Date $MM Issuer (Priced *, Launch #)
- 10/07 $2.5B *Bank of England 5Y +8a
- 10/07 $1.75B *CPPIB 3Y SOFR+39
- 10/07 $Benchmark Angola +5Y 9.75%a, 10Y 10.5%a
- 10/07 $Benchmark Türkiye Garanti Bankası 10.5NC5.5
- 10/07 $Benchmark TD Synnex +3Y +100a, 10Y +145a
- 10/07 $Benchmark Goldman Sachs investor calls
- 10/07 $Benchmark JDC Dev Bank Kazakhstan +5Y, KZT 3Y investor calls
- Expected Wednesday
- 10/08 $Benchmark Federal Home Loan 2Y +4a
- 10/08 $1B Kommunalbanken Norway WNG 3Y SOFR+37
OPTIONS: Expiries for Oct08 NY cut 1000ET (Source DTCC)
- EUR/USD: $1.1650(E698mln), $1.1700(E1.1bln), $1.1770-80(E1.2bln), $1.1800(E1.5bln), $1.1850-60(E1.0bln)
- USD/JPY: Y146.50($1.2bln), Y147.00($1.5bln), Y149.00($980mln), Y150.00($562mln), Y151.00($799mln)
