Our research

Carbon Market Strategist - EU ETS review signals less scarcity and more industrial policy

The EU ETS review reduces long-term allowance scarcity while EU's climate targets remain unchanged. Supply-side reforms dominate the package, with changes to the cap trajectory and Market Stability Reserve potentially adding nearly 2 billion allowances by 2040. New sectors and activities increase EUA demand, but their impact is gradual and outweighed by additional supply flexibility. Energy-intensive industries, removals developers and Article 6 projects stand to benefit, while long EUA scarcity positions face pressure. We expect EUA prices to be at a lower level but remain structurally elevated with an upward trajectory if the review to be fully adopted. Prices are expected to reach 91 EUR/tCO₂ in 2030 and 164 EUR/tCO₂ in 2035 under the review scenario.

Transaction Trends: Keeping a finger on the pulse of higher energy prices

Are Dutch households already feeling the impact of higher energy prices? In this publication, we use anonymised and aggregated transaction data from more than a million households to track how higher energy prices are affecting household finances. Interestingly, despite five months of elevated energy market prices, the median household energy payment has barely increased. This is because many existing contracts are still in effect and new electricity tariffs are not significantly higher. Although higher oil prices are quickly passed on at the pump, the increase in household fuel spending has so far remained limited as motorists adjust their behaviour.

FX Weekly - Dollar struggles despite higher US yields

Energy prices are rising due to the US-Iran standoff, supporting oil- and gas-linked currencies such as the Norwegian krone, while the Canadian dollar is held back by tariff concerns. US-Japan yen intervention is still affecting markets, mainly through the US Treasury market rather than the yen itself. US yields have risen partly because investors demand a higher term premium. Higher US yields are not supporting the dollar, because they reflect risk and uncertainty rather than stronger growth. EUR/USD has moved above 1.16 and further dollar weakness is expected.

Energy: Green growth, with red figures: the EU remains a net importer of clean tech

Demand for clean technologies (also known as ‘clean tech’) from the European Union (EU) is set to rise sharply in the coming years. This is due to not only the EU’s ambition to meet its climate targets, but also to its drive to achieve greater energy security. It is highly likely that the acceleration in demand for clean tech will lead to a further increase in trade flows in clean technologies between the EU and its current trading partners. This analysis focuses on trade flows in clean technologies between the EU and countries outside the EU. We do not only highlight the balance of imports and exports of clean technologies in the EU-27 in relation to countries outside the EU-27, but also show which countries are the EU-27’s most important trading partners. The analysis also examines the impact of recent geopolitical conflicts on trade flows: that impact the region’s energy security. Finally, we assess the feasibility of the EU’s clean tech targets for clean technologies for 2030.

China: Weak July data add to urgency of support

July activity data show a weakening across the board, with domestic supply-demand imbalances worsening. This means that the urgency of adding policy support is rising again

FX Weekly - Markets test the line on yen weakness

The yen remains deeply undervalued, but weakness reflects structural and policy factors. Coordinated US-Japan intervention suggests authorities are increasingly uncomfortable with yen weakness. FX markets may require repeated action before they believe a line has been drawn. EUR/USD should remain range-bound until US data and central bank events provide clearer direction.

Transaction Trends - When temperatures spike, consumption seeks cooling

Extreme heat not only affects health and quality of life, but also leads to noticeable shifts in household spending behavior. The recent heatwave was accompanied by a temporary decline in Dutch household consumption. Online spending and cash withdrawals declined during the heatwave, while card spending initially increased and only fell during the most extreme heat conditions. Card spending held up relatively better in highly urbanised areas than in less urbanised regions. In particular, spending at restaurants and cafés increased in these areas, while fuel expenditures declined sharply elsewhere.

Labour market weakness could re-balance Fed concerns

AI propels Dutch manufacturing output growth

The Nevi Dutch Manufacturing PMI fell slightly, from 55.5 to 54.4 in July, and thus still indicates strong growth. Demand rose slightly less rapidly than in the previous months. Nevertheless, the industry increased output at the fastest pace since February 2022.

Ireland volatility masks solid underlying eurozone growth

Eurozone Q2 GDP surprised to the upside at 0.4% q/q (consensus: 0.2%/ABN: 0.3%), and Q1 GDP was revised considerably higher – from a 0.2% contraction to a flat reading. Unsurprisingly, much of the surprise and the backward revision was driven by Ireland, with Q1’s massive contraction seeing yet another big revision to -7% q/q (from -12%). However, underlying growth was also revised a little higher, with Germany’s Q1 GDP growth revised up to 0.4% from 0.3%.