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Commerzbank on Overnight News

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-- Commerzbank in its "European Sunrise" note of Friday highlighted:

Markets: United States Treasuries stabilize, equity futures recover in Asia after volatility from the Strait of Hormuz (SoH) news. Brent reverses back below US$102/barrel after spike, US dollar (USD) rangebound in Asia.

Fed: Minneapolis Federal Reserve President Neel Kashkari is uncertain about the next step, may "need to be up" if SoH is closed for an extended period. Fed Bank of New York President John Williams says policymakers will "make sure" inflation comes down, sees "remarkable" resilience of the U.S. economy. Fed Bank of Cleveland President Beth Hammack says FOMC language signaling bias towards a cut was misleading. San Francisco Fed President Mary Daly flags unanimous rate decision. Fed Bank of Boston President Susan Collins agrees with FOMC dissenters on forward guidance language.

Tariffs: President Donald Trump gives the European Union until July 4 to sign the Turnberry deal after a "great call" with European Commission President Ursula von der Leyen. U.S. court declares Trump's latest tariffs as unlawful.

Iran war: President Trump says ceasefire still in effect and deal "could happen any day" after US hit Iranian targets in response to attacks on three U..S destroyers transiting out of SoH; UAE intercepted drones and missiles. Classified CIA assessment says Iran can outlast SoH blockade for months (The Washington Post).

==EUROPE:

ECB: European Central Bank Governing Council member Isabel Schnabel says if energy shock broadens, "monetary policy will need to tighten to contain the risk of 2nd-round effects" and "risk has increased in recent weeks."

Germany: AfD (27%, +3pp) overtakes CDU/CSU (24%, -2pp), Prime Minister Friedrich Merz with the lowest approval rating of an incumbent PM on record (ARD Deutschlandtrend).

-- France: Jordan Bardella linked to EU investigation into possible misappropriation of EU funds by far-right National Rally.

United Kingdom: The Labour Party suffers heavy losses, Reform gains in early results from local elections.

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