POWER: EU Mid-Day Power Summary: French-German May Discount Narrows
The French-German May discount has narrowed to €37.94/MWh at the time of writing to reach its lowest since 22 April, with their respective markets weighed down by losses in the energy complex. Nordics have also moved down to track losses in German power, coupled with the return of the OL3 nuke.
- Nordic Base Power MAY 25 down 3.1% at 20.5 EUR/MWh
- France Base Power MAY 25 down 7% at 27.7 EUR/MWh
- Germany Base Power MAY 25 down 3.1% at 65.73 EUR/MWh
- EUA DEC 25 down 2.6% at 64.72 EUR/MT
- TTF Gas MAY 25 down 1% at 32.105 EUR/MWh
- TTF has fallen on Putin’s declaration of a truce in Ukraine across May 7-11, raising the prospects of further negotiations towards a prolonged peace agreement.
- EUAs Dec25 are trending downward, influenced by EU gas losses.
- Germany’s Bnetza set the country’s power plant reserve needs at 6.49GW for the 2025/2026 winter period, down by 7% from the previous winter.
- Entso-e proposes future bidding zone configurations, with Central Europe TSOs advocating for a five-zone split of Germany–Luxembourg, while a Dutch bidding zone split also indicates economic efficiency.
- The proposed split of the German-Luxembourg bidding zone results in a decrease in Germany’s net position by 8-12 TWh, primarily due to increased market-based RES curtailment, reduced gas production in northern zones, and lower imports from the Nordic.
- Spain RedElectrica has activated power restoration plans, it said via X, following a major power outage that hit most of Spain and several regions in Portugal.
- Axpo has signed a short-term PPA with EdF Renewables Hellas to purchase electricity from two solar PV plants in Greece.
- Poland’s PEJ will sign a contract with Westinghouse and Bechtel on Monday on the design of the country’s first nuclear power plant.
- UK data centre developers are increasingly turning to gas pipelines and planning their own gas-fired power plants due to long delays in accessing the electricity grid.
- Ireland has the potential to add between 5.768- 9.444GW of new onshore wind capacity — on top of the approximately 9.25GW already operational, permitted, or in planning.
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USDCAD TECHS: Bullish Outlook
- RES 4: 1.4700 Round number resistance
- RES 3: 1.4641 76.4% retracement of the Feb 3 - 14 bear leg
- RES 2: 1.4452/4543 High Mar 13 / 4 and a bull trigger
- RES 1: 1.4402 High Mar 20
- PRICE: 1.4292 @ 16:50 GMT Mar 28
- SUP 1: 1.4235 Low Mar 26 and a key near-term support
- SUP 2: 1.4151/4107 Low Feb 14 / 50.0% of Sep 25 - Feb 3 bull run
- SUP 3: 1.4011 Low Dec 5 ‘24
- SUP 4: 1.3944 61.8% retracement of the Sep 25 ‘24 - Feb 3 bull cycle
USDCAD traded through support at 1.4242 on Wednesday but has recovered. A return lower and clearance of this level would undermine the bull theme and instead highlight potential for a test of 1.4151, the Feb 14 low and a bear trigger. Moving average studies continue to highlight a dominant uptrend. A reversal higher would refocus attention on the bull trigger at 1.4543, the Mar 4 high. First resistance is 1.4402, the Mar 20 high.
US FISCAL: Debt Limit "Extraordinary Measures" Pick Up, But Cash Dipping Pre-Tax
Treasury data shows that there were $207B of "extraordinary measures" available to circumvent hitting the debt limit as of Wednesday Mar 26.
- That's the most since Jan 27th and up from $163B a week earlier, from a total $376B available.
- However, Treasury cash in the TGA fell to $316B as of the 26th (and was down to $280B on Thursday), meaning there were a combined $523B of resources available to avert the debt limit, the lowest since the impasse began in January (and half of the starting amount of just over $1T).
- The next couple of weeks will be very important for Treasury, as they represent the biggest tax take of the year. The Congressional Budget Office reported this week that per its estimates "if the debt limit [$36.1T] remains unchanged, the government's ability to borrow using extraordinary measures will probably be exhausted in August or September 2025." Treasury wrote to Congress this month that they would be able to provide an update on the x-date in the first half of May, after the conclusion of tax season.
AUDUSD TECHS: Remains Above Support
- RES 4: 0.6429 High Dec 12 ‘24
- RES 3: 0.6414 38.2% retracement of the Sep 30 ‘24 - Feb 3 bear leg
- RES 2: 0.6409 High Feb 21 and a bull trigger
- RES 1: 0.6391 High Mar 17 / 18
- PRICE: 0.6291 @ 16:46 GMT Mar 28
- SUP 1: 0.6258 Low Mar 21
- SUP 2: 0.6187 Low Feb 4
- SUP 3: 0.6171/6088 Low Feb 4 / 3 and a key support
- SUP 4: 0.6045 1.500 proj of the Sep 30 - Nov 6 - 7 price swing
AUDUSD is unchanged. A short-term bull theme is intact and the latest move down appears corrective. Key short-term support to watch is 0.6187, the Mar 4 low. Clearance of this level would reinstate a bear threat. First support is at 0.6258, the Mar 21 low. A stronger recovery would refocus attention on 0.6409, the Feb 21 high. Clearance of this hurdle would strengthen the bull cycle and resume the uptrend that started Feb 3.
