Commerzbank on Overnight News

05:58 AM EDT, 10/30/2025 (MT Newswires) -- Commerzbank in its "European Sunrise" note of Thursday highlighted:

Markets: United States Treasuries slump on Federal Reserve Chair Jerome Powell comments, with curve flattening, stabilize in Asia. E-minis recover initial losses, erase gains again after the President Donald Trump and Chinese President Xi Jinping meeting. The US dollar (USD) strengthens with the euro (EUR) falling below $1.16 before recovering, oil hovers below $65/barrel.

Fed cuts by 25bps, stops quantitative tightening (QT) as of Dec. 1. Statement says downside risks to employment rose in recent months, while inflation remains elevated. Powell says December rate cut "far from" foregone conclusion, "there were strongly differing views" on Wednesday. Fed Governor Stephen Miran voted for 50bps cut, Kansas City Fed President Jeffrey Schmid voted for leaving rates unchanged.

Trade: Trump calls meeting with Xi "amazing," agreed on "almost everything," lowers fentanyl tariffs to 10%, effective immediately. Adds that he will go to China in April. U.S. Trade Representative Jamieson Greer says China won't impose rare earth controls, Trump says all "rare earths have been settled" and expects a trade deal to be signed pretty soon. Xi says dialogue is better than confrontation.

Geopolitics: Trump says he instructed the Dept of War to "immediately" start testing nuclear weapons on "equal basis."

Tech: OpenAI is preparing to file for IPO as soon as next year, company might be valued at $1 trillion (Reuters sources).

==EUROPE:

Dutch elections: Parties of collapsed government lose ground, left-wing D66 and right-wing PVV both lead with 26 seats each. D66 promises "end to the politics of hatred," PVV leader Geert Wilders expresses disappointment with the result, Frans Timmermans steps down after Green/Left-Labour lose shares.

France: Q3 gross domestic product rises by 0.5% quarter over quarter, while the consensus was a 0.2% gain.

UK: United Kingdom Prime Minister Keir Starmer refuses to rule out raising income tax in the budget.

==ASIA:

Jaoan: Bank of Japan votes to keep rate unchanged by 7-2, same as in September, as risks to prices are balanced, while economic risks are rather to the downside for next year, reiterates it will raise rates if price outlook is realized.

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