Spot NZUs shed 5 NZ cents over the week to close at NZ$7.00 ($4.58) with volumes dropping as traders lacked incentive, market participants said.
The spot contract opened the week at last week’s closing price of NZ$7.05, but has been unchanged at NZ$7.00 since Tuesday with very little volume going through.
“It’s a Mexican stand-off between buyers and sellers at this point. All it takes is one emitter to come through with a buy order to push this market to fresh highs. Any selling will be short-lived. At the risk of being a broken record, the buyers need to buy but the sellers don’t need to sell,” brokers OM Financial said in a note to clients.
New Zealand’s recently released INDC provided little guidance for traders in terms of future price movements, and market participants are now awaiting news on the scope of the upcoming ETS review.
Meanwhile, last week’s tender, where a seller announce it might offload up to 1 million NZUs, came to nothing, as it preferred to hold on to the allowances rather than contract any sales a the bid prices, OMF said.
By Stian Reklev – firstname.lastname@example.org