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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 supported in Asia as oil drifts lower, e-minis rangebound after S&P and Nasdaq close at new highs. The US dollar (USD) strengthens.

Fed: St. Louis Federal Reserve President Alberto Musalem wanted to remove easing bias last month, thinks "it would be risky to rely on the prospect of higher productivity growth in the future to solve our inflation problem today". Richmond Fed President Thomas Barkin argues that Artificial Intelligence-related investments push up the neutral interest rate.

Iran war: Vice President JD Vance says the U.S. and Iran are "very close" to the Memorandum of Understanding (MoU), Iran appears to be negotiating in good faith. Tasnim news agency reports that the draft MoU isn't yet finalized. Treasury Secretary Scott Bessent underscores President Donald Trump's three red lines -- Strait of Hormuz reopening, highly enriched uranium and nuclear program.

==EUROPE:

EU: The European Commission to discuss Mythos access with Anthropic (Bloomberg), final discussion likely to require approval of the U.S. The European Union says revival of local chip production would require investments of 120 billion euros by 2035.

Germany: Prime Minister Friedrich Merz underscores commitment to reform agenda at local CDU gathering, doesn't address speculation that he will be replaced by Hendrik Wust.

==ASIA:

Japan: Finance minister says authorities could take bold moves against speculative foreign exchange moves. Tokyo's consumer price index rose less than expected in May.

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