By Mathew Carr
Nature-based carbon credits plunged 9% to a record low Friday, as the U.K. government led by PM Liz Truss focused on economic growth rather than environmental protection.
I’m wary to read too much into the move, because there is little trading in the Dec. 2026 futures. The closing price can be an indicated price. Still, there were similar moves in the Dec. 24 and Dec. 25 contracts, according to exchange group ICE.
The UK is seeking to become a global hub for carbon trading, (or at least it was before Truss took over as PM earlier this month).
The British pound dropped to its lowest ever against the dollar this morning as markets react to Truss’s decision to offer the biggest tax cuts in 50 years, which could boost inflation that’s already at multi-year highs.
From the Guardian newspaper:
UK bonds slump after pound plunges to record low against dollar – business live
Economists suggest Bank of England may need an emergency interest rate hike, as gilts slide and sterling slumps to a record low against the US dollar
Some people, including CarrZee, are calling for a more enlightened capitalism — one that is focused on climate, nature, inequality in society — not just economic production / greed / tax cuts. Truss and her cabinet does not seem to be on board.
If you know why the nature-based carbon futures are moving, let me know at email@example.com (or even better, get in touch if you have a view about where they are heading, price wise.)
Related story from last month, when the contracts were first offered: