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BULL FLATTENING

GILT SUMMARY

Gilts have remained bid through the session with yields edging down to the

lows of the day, alongside weak trading in equities.
- The Sep-20 Gilt future has traded up to 138.31, near the top of the day's
range and 3 ticks off the high.
- Cash yields are 1-2bp lower and the curve has bull flattened with the 2s10s
spread 2bp narrower on the day. Current yield levels: 2-year -0.1063%,
5-year -0.1259%, 10-year 0.1148%, 30-year 0.6290%

- The DMO will tomorrow sell the 1.625% Oct-54 Gilt for GBP1.5bn and the
1.25% Jul-27 Gilt for GBP2.75bn.
- Tomorrow will see the release of the Lloyds Business Barometer for July,
as well as the CBI Retailing Reported Sales data for the same month.

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