Nordic sustainable quarterly: Green bonds with a golden touch

Danske Research Team Danske Bank A/S

The long-awaited EU Green Bond Standard (GBS) - intended as the "golden standard" for green bonds - has been approved and is set to apply from end-2024. The voluntary EU GBS tries to change the ambiguous nature of what is considered 'green' as it lays down uniform requirements for bond issuers that wish to use the label "European Green Bond" or "EuGB" for their bonds. For bond investors, the new standard should enable them to more easily determine whether their investments are sustainable, reducing the risk of greenwashing, and facilitate comparison. In this edition of the Nordic Sustainable Quarterly, we present our initial thoughts on the EU GBS, its usability, and potential challenges.

The appeal of Nordic sustainable bonds continues to gain strength. So far this year the share of sustainable bond issuance relative to total corporate issuance has continued to grow in the Nordic markets, representing close to 35% of total corporate bond issuance YTD.

The Task Force on Nature-related Financial Disclosures (TNFD) recently presented a new disclosure framework to assess nature-related issues. The TNFD recommendations are structured to allow companies and financial institutions to get started. In the coming years we expect this disclosure framework to gain importance. In a survey carried out by TNFD, more than 86% of respondents said that they could start reporting TNFD disclosures for the financial year 2025.

In a new publication produced by Danske Bank Credit Research we present our view on the main ESG risks facing the 16 Swedish real estate companies under our coverage. New features in the report include special sections on direct physical climate risks, the EU Taxonomy, the forthcoming Energy Performance of Buildings Directive (EPBD), the Corporate Sustainability Reporting Directive (CSRD), and an analytical tool to benchmark governance risk. In terms of relative value, we prefer the following names in the sector: Balder, Castellum, Cibus Nordic Real Estate, Emilshus, Fastpartner, and NP3.

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Author

Danske Research Team

Danske Bank A/S

Research is part of Danske Bank Markets and operate as Danske Bank's research department. The department monitors financial markets and economic trends of relevance to Danske Bank Markets and its clients.

EUR/USD meets initial support around 1.1800

EUR/USD remains on the back foot, although it has managed to reverse the initial strong pullback toward the 1.1800 region and regain some balance, hovering around the 1.1850 zone as the NA session draws to a close on Tuesday. Moving forward, market participants will now shift their attention to the release of the FOMC Minutes and US hard data on Wednesday.

GBP/USD bounces off lows, retargets 1.3550

After bottoming out just below the 1.3500 yardstick, GBP/USD now gathers some fresh bids and advances to the 1.3530-1.3540 band in the latter part of Tuesday’s session. Cable’s recovery comes as the Greenback surrenders part of its advance, although it keeps the bullish bias well in place for the day.

Gold remains offered below $5,000

Gold stays on the defensive on Tuesday, receding to the sub-$5,000 region per troy ounce on the back of the persistent move higher in the Greenback. The precious metal’s decline is also underpinned by the modest uptick in US Treasury yields across the spectrum.

Ethereum Price Forecast: BitMine extends ETH buying streak, says long-term outlook remains positive

Ethereum (ETH) treasury firm BitMine Immersion continued its weekly purchase of the top altcoin last week after acquiring 45,759 ETH.

UK jobs market weakens, bolstering rate cut hopes

In the UK, the latest jobs report made for difficult reading. Nonetheless, this represents yet another reminder for the Bank of England that they need to act swiftly given the collapse in inflation expected over the coming months.

Ripple slides to $1.45 as downside risks surge

Ripple edges lower at the time of writing on Tuesday, from the daily open of $1.48, as headwinds persist across the crypto market. A short-term support is emerging at $1.45, but a buildup of bearish positions could further weaken the derivatives market and prolong the correction.