California Carbon Allowance (CCA) prices continued to decline this week in line with macroeconomic weakness, trading down over 7%. Dec22 closed the week at $29.65/allowance. The spot market (June) continues to trade below the last auction settlement price of $30.85, closing Friday at $29.19. Dec22 reached a five-month high of $33.28 at the beginning of June before selling off, down almost 11% so far this month. The one year (Dec22-Dec23) spread in CCAs continues to expand, closing Friday at 6.88%, up from 6.7% the prior Friday. Implied volatility continues to trade in the low to mid-30% range, down from around 40% at the end of May.

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