Since the liberalization of electricity markets in the European Union, prices are subject to market dynamics. Hence, understanding the short-term drivers of electricity prices is of major interest to electricity companies and policy-makers. Accordingly, this paper studies movements of prices in the combined German and Austrian electricity market. Approach We estimate an autoregressive model with exogenous variables (ARX) in a twostep procedure. We first de-seasonalize both time series, which inherently feature seasonality, and, in a second step, measure the influence of all model variables on the two dependent variables, i. e. the day-ahead and intraday EPEX prices. Findings Our results reveal that the short-term market is largely driven by seasonality, consumer demand and short-term feed-ins from renewable energy sources. As a contribution to the existing body of literature, this paper specifically compares the price movements in day-ahead and intraday markets. In intraday markets, the influences of renewable energies are much stronger than in day-ahead markets, i. e. by 24.12 % for wind and 116.82 % for solar infeeds.

In a globalised world, the volume of international trade is based on both import and export prices, thereby making a country's economy highly dependent on exchange rates. In order to study exchange rate movements, one frequently exploits the so-called Dornbusch overshooting model. However, the model is controversial from a theoretical point of view: it explains exchange rate movements by a number of fundamental variables but ignores how novel information in the form of news can enter the market. As a remedy, this paper adjusts for information dissemination by performing a multivariate analysis to compare the classical overshooting model with an extended variant that includes news sentiment. Our results show that news sentiment has a substantial explanatory power of 11 % of the exchange rate forecasting error variance. In addition, we also find statistical evidence that a shock in news sentiment may lead to overshooting.

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The Emissions Trading System in the European Union was introduced to achieve the climate goal of reducing emissions by around 43% between 1990 and 2030. Accordingly, the costs of emission allowances are part of power generation and, by extension, the price of electricity. Theoretical works thus suggest a positive relationship between the price of emission allowances and electricity. However, this has not been validated empirically for phase III of the Emissions Trading System in the short run as part of the price setting mechanism of electricity producers. Our evidence suggests an opposite effect: According to our empricial results, both European Power Exchange (EPEX) day-ahead and intraday markets are negatively affected during phase III. We further test for a potentially asymmetric influence with the help of quantile regressions. Altogether, the outcome has implications for policy-makers and calls for further attention by academics and policy-makers in the future design of the Emissions Trading System, especially under larger amount of renewables in the electricity system.