Daily Update: Navigating Economic Uncertainty; Carbon Credit Oversupply; and Rising Defaults in Private Credit
Today is Thursday, August 7, 2025, and here’s your curated selection of Essential Intelligence on global markets from S&P Global. Subscribe to be notified of each new Daily Update.
Economy
In this episode of the “Look Forward” podcast, host Andy Critchlow and Paul Gruenwald , global chief economist at S&P Global Ratings , delve into the issues shaping the global economy in 2025. The discussion kicks off with an examination of central bank independence and its role in maintaining macroeconomic stability.
Critchlow and Gruenwald explore the state of the US economy and address the challenges posed by tariffs and political pressures, highlighting the fine line between growth and recession.
Energy Transition & Sustainability
Secondary market prices in the Alberta compliance carbon market have decreased significantly year over year amid credit oversupply and an upcoming 2026 regulatory program review. Credit and offset prices within the Technology Innovation and Emissions Reduction (TIER) market have fallen more than 55% to C$24.50 per metric ton of CO2 equivalent on Aug. 4 from C$55/tCO2e in the third quarter of 2024, according to Platts, a part of S&P Global Commodity Insights.
Platts launched the daily price assessments for instruments traded in the Alberta TIER market on Aug. 1.
TIER was introduced in 2019 and aims to curb emissions from high-emitting facilities while maintaining competitiveness, allowing compliance through on-site reductions, credit trading or fund payments.
Private Markets
Private credit has emerged as a dynamic force in global finance, with assets under management projected to exceed $3 trillion by 2028. Driven by regulations imposed on traditional banks after the global financial crisis of the late 2000s, nonbank financial institutions — including private credit funds and business development companies — have filled the lending void for small and medium-sized enterprises.
This study explores the rapid expansion of private credit, highlighting its diversification benefits, flexible financing structures and growing interconnectedness with banks, insurance companies and asset managers. Loans from US banks to nonbank financial institutions have surpassed $1 trillion, with global systemically important banks playing a pivotal role through subscription lines and collateralized financing.
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