OVERVIEW
• NZUs weaken as buyers retreat
• Where is the supply?
COMMENTARY
NZUs closed down at $24.80 in reasonable trade. Whilst there aren’t a lot of sellers around nor are there lots of buyers either, it’s clear many emitters are treating the $25 Fixed Price Option (FPO) as a free option. Implying a forward for April 2020 at 2% is $25, spot is basically an FPO trade. Therefore the market may drift lower if buyers remain absent and it’s not taking much volume to knock it down at the moment.
Having said that – given the changes afoot,…
