EMISSIONS: EU Mid-Day Carbon Summary: Carbon Rise, Record High Correlation
May-09 11:25
EUAs/UKAs Dec25 are up 3% and nearly 5% respectively on the week, tracking gains in EU gas and equities. Meanwhile, EUA-UKA are tightening 30-day correlation to the highest level since April 2024 ahead of EU-UK Summit on 19 May.
- EUA DEC 25 up 0.08% at 70.78 EUR/t CO2e
- UKA DEC 25 up 0.12% at 51.83 GBP/t CO2e
- TTF Gas JUN 25 down 1.4% at 34.855 EUR/MWh
- NBP Gas JUN 25 down 1.5% at 83.55 GBp/therm
- Estoxx 50 up 0.6% at 5293
- FTSE 100 JUN 25 up 0.4% at 8572
- Correlation between EUA/UKA for 30-day period at 0.77.
- TTF prices are slightly lower today as recent supply concerns from Norway and the US have eased and due to softer demand and higher temperatures. Front month is still set for a net gain on the week amid improve global trade optimism.
- The latest Germany ETS CAP3 auction cleared at €70.2/ton CO2e, up 6.54% compared with the previous Germany auction at €65.89/ton CO2e according to EEX.
- EUA Auction Calendar Week Ahead (Calendar Week 20) - A total of 13.4mn EUAs will be auctioned next week, with a full 5-day auction week, the highest weekly volume since the week ending 4 April, due to holidays in the past few weeks.
- EUA Dec25 implied volatility as of 8 May fell to its lowest level since early April, as tariff tensions eased and carbon prices rose steadily during the period. EUAs Dec25 are tracking nearly 3% in weekly gains, while EU gas is up 6%.
- The World Cement Association (WCA) has expressed support for UK-EU ETS linkage, calling for consistent pricing and investment certainty, it said.
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UK: ITV-PM Says Fiscal Rules "Iron Clad & Here To Stay", "Won't Be Changed"
Apr-09 11:22
Robert Peston at ITV posts on X: "The prime minister has just told me that the chancellor’s fiscal rules are “iron clad and here to stay”, that “they won’t be changed”. This is his response to contagion from the shocking Trump-induced fall in US government bond prices, which has seen the interest rate for UK 30-year sovereign debt rise to levels not seen since 1998. He is explicitly trying to reassure lenders to the UK"
- There has been speculation in recent weeks that the fiscal rules could be altered amid the prospect of another tax raising/spending cutting budget to come in the autumn. Speaking on Monday, PM Sir Keir Starmer said the rules 'won't be ignored'.
- Chancellor of the Exchequer Rachel Reves said earlier, when asked if the fiscal rules would remain unchanged for the whole parliament "Yes. Those fiscal rules ... are non-negotiable because they are the bedrock of the stability and security that families and businesses need."
- Nevertheless, this marks the first time the PM has committed to them remaining as-is.
TARIFFS: China increases tariffs on US to 84% from 34%
Apr-09 11:14
- The China tariff increase on the US is to 84% from 34% and is applicable from 12:01 China standard time on 10 April (so in a few hours).
- The language has escalated, too.
- From the press release via Google Translate: "The US's practice of escalating tariffs on China is a mistake on top of a mistake, which seriously infringes on China's legitimate rights and interests and seriously damages the rules-based multilateral trading system."
- Full statement link.
US TSYS: Tsys Briefly Pare Losses, Remain Weaker After China Tariff Retaliation
Apr-09 11:11
- Treasury futures pared down move briefly after China tariff response with 84% duty on US imports, up from 34%.
- June'25 10Y futures tapped 111-00.5 currently trades 110-20.5 (-26.5), 10Y yield 4.3898 +.0969. Curves bear steepen to new multi-year highs overnight: 2s10s currently +6.369 at 62.482 after tapping 73.84 during Asia hours.
- Stocks come back under pressure: SPX eminis -81.75 at 4938.25.
