German Chancellor Merz is due to speak at 12:30BST/07:30ET, Politico reports; expected to provide insight on the changes CDU intends to do after the poor September elections.

Speeches of this type, a party leader responding to a poor election result, sit in the category where the rhetoric matters less than what it signals about coalition arithmetic, fiscal posture and the party's positioning toward its rivals. German political resets have historically been slow-moving for markets unless they touch the fiscal rules: any hint of a shift in attitude toward the debt brake, the special funds architecture or defence and infrastructure spending is what transmits, via Bund supply expectations and the BTP-Bund spread rather than through FX. The secondary channel is coalition dynamics, since post-election repositioning of this kind has in past episodes foreshadowed changes in the governing majority or in the policy concessions a chancellor is willing to make. The watch items are whether the remarks name concrete fiscal or defence commitments, whether coalition partners respond within the session, and whether Bund futures show any supply-driven steepening of the long end. Absent specifics on spending, commentary of this kind has tended to be a non-event for German assets.