EMISSIONS: UKAs Rise On EUAs, UK Equities Movements
Jun-05 07:48
UKAs Dec25 are edging up on the day, amid mix influence from EUAs and UK equities movements, with the correlation between UKAs and both contracts remaining at a similar level.
- UKA DEC 25 up 0.8% at 50.7 GBP/t CO2e
- NBP Gas JUL 25 up 2.3% at 85.27 GBp/therm
- FTSE 100 JUN 25 up 0% at 8815
- ICE UKA futures daily aggregate traded volume at 1,029 contracts in the previous day, down 62.16% compared with the 30-day average daily volume.
- The EUA Dec25 premium to the UK equivalent is rising to the highest level since mid-May at €13/t CO2e.
- Correlation between EUA/UKA for 30-day period remained high at 0.45.
- Correlation between UKA/FTSE100 for 30-day period remained at 0.40.
- UK gas demand, including power generation and exports, is forecast at 123 mcm/d, significantly below the five-year average of 167 mcm/d, according to National Grid.
- UK wind is expected to be the highest next week on 12 June at a 40% load factor and the lowest on 11 June at 15%, according to SpotRenewables.
- The latest month-ahead ECMWF weather forecast for the UK remained above average for most days.
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EGB SYNDICATION: Germany 30-year Syndicated Tap: Guidance
May-06 07:31
- EUR Benchmark Tap of DBR 2.9% 08/15/56 DBR+3.25 Area (MNI expects E4-6bln)
- Benchmark: DBR 2.5% 08/15/54
- Coupon: 2.9%, annual, act/act, long first
- Settlement: May 13, 2025
- ISIN: DE000BU2D012
- Bookrunners: Barclays, Citi (B&D), CA-CIB, DZ Bank, GS, JPM. Remaining members of the Bund Issues Auction Group will be invited into the co-lead group
- Timing: May price today
Details as per BBG
EUR: An underlying bid goes through in the EUR
May-06 07:31
- A small underlying bid in the EUR is going through combined with some offers in the USD, the EUR is testing intraday highs against the USD, GBP, CHF, AUD, SEK, and NOK.
- While the Aussie is the worst performer, next resistance in EURGBP comes at 0.8557 High Apr 28.
(Chart source: MNI/Bloomberg).
GILTS: /STIR: Citi Eye BoE Guidance, Bank Rate To Remain Main Support For Gilts
May-06 07:24
Citi note that “with a 25bp cut to Bank Rate widely expected, the focus at this week’s MPC meeting will be on the communication”.
- Their economists view the outlook as “more unambiguously disinflationary and think the MPC will still value time-optionality for now and therefore expect ‘gradual and careful’ to remain the main guidance for at least this meeting”.
- They also suggest that “the BoE could reaffirm that further QT (beyond September) is subject to market conditions and targeted QE is still a backstop, but the primary support for gilts is likely to come via lower Bank Rate”.
