06:21 AM EST, 03/03/2025 (MT Newswires) -- Commerzbank in its "European Sunrise" note of Monday highlighted:

Markets: German Bund future gaps sharply lower in Asian trading on spending plans. United States Treasuries also weaken, then stabilize. Asian stocks and e-minis are supported. EUR slightly firmer. Brent tests $73/barrel support.

U.S./Fed: Chicago Federal Reserve Bank President Austan Goolsbee is "partly" concerned about slow growth and inflation risks but still sees inflation on the path back to 2%. Treasury Secretary Scott Bessent is confident that inflation will reach 2% over the course of the year.

U.S.: Atlanta Fed GDPNow falls sharply after ballooning goods-trade deficit to 1.5% in Q1. St. Louis Fed nowcast fell to 1.49% from 1.77%, NY Fed model remains little changed at 2.94%.

U.S. Tariffs: Bessent says the Mexican government's proposal to match the U.S. on China tariffs is "very interesting" and it would be "a nice gesture" if Canada would follow.

U.S./Ukraine: United Kingdom Prime Minister Keir Starmer tried to convince President Donald Trump and President Volodymyr Zelenskiy to revive a U.S.-Ukraine economic deal but ultimately failed (Bloomberg). Zelenskiy said he's willing to meet Trump if invited "to solve real problems." NATO's Secretary General Mark Rutte told Zelenskiy to repair his relationship with the U.S. Trump considers ending all ongoing military aid shipments to Ukraine (Washington Post).

==EUROPE:

Europe/Ukraine: European leaders sought to assemble a "coalition of the willing" to secure Ukraine after any U.S.-brokered ceasefire. Starmer said Britain and France and "one or two others" work with Ukraine on a "plan to stop the fighting".

EU needs surge in defence, European Commission President Ursula von der Leyen says. French President Emmanuel Macron urges member states to agree on "massive, common funding" to unlock investments of "hundreds of billions of euros" for defense and security (Politico).

Germany: Center-right CDU and center-left SPD consider two special defense and infrastructure funds to be approved by the outgoing parliament in March. Advising economists estimate around 400 billion euros for defense and 400 billion-500 billion euros for infrastructure. Fundamental reform of the debt brake will be tackled under the new Bundestag (Reuters sources).

Germany: SPD wins election in Hamburg with 33.5% (-5.7pp), ahead of CDU 19.8% (+8.6), Greens 18.5% (-5.7), Left 11.2% (+2.1) and AfD 7.5% (+2.2). SPD prefers to continue a coalition with the Greens.

Netherlands: HICP rate increases to 3.5% year over year from 3% while consensus was 3.2%.

France: S&P lowers outlook for France to negative from stable, affirms AA-, citing public finance pressures that could require primary surpluses to reduce debt from 2028 and limited political backing for reforms.

Ratings: S&P upgrades Portugal to A from A- due to external deleveraging, maintains positive outlook. Fitch affirms Germany at AAA/stable and UK at AA-/stable. Moody's affirms the Netherlands at Aaa/stable and DBRS at AAA/stable.

==ASIA:

China: Manufacturing PMI rises stronger than expected by 1.1pts to 50.2 with consensus at 49.9, non-manufacturing PMI increases in line 0.2pts to 50.4. Caixin manufacturing PMI rises 0.7pts to 50.8 while consensus at 50.4.