Comments from BoE Cunliffe and US......>

GILT SUMMARY: Comments from BoE Cunliffe and US President Trump knocked Gilts

from nears session highs in the afternoon, leaving them mixed on the day. 10-yr

part of the curve is outperforming the short and ultra-long end of the curve.

- 2-yr Gilt yield is +0.8bp at 0.743%, 5-yr -0.1bp at 1.027%, 10-yr -0.7bp at

1.27%, 30-yr +0.2bp at 1.722% & 50-yr +1.3bp at 1.573% according to Tradeweb.

- Sep gilt future was trading close to session highs before selling off on

comments from BoE Cunliffe that reinforced market expectations of the interest

rate rising next month -- balance of evidence shows little slack and spare

capacity left, MPC's May forecasts of the growth path remains broadly intact.

Rumours of of a more conciliatory tone from Trump also weighed.

- Trumps comments that he looks forward to a bilateral free trade with the UK

when Brexit is completed, that the US/UK relationship is the "highest level of

special" and rowed back on his Sun comments about PM May, led gilts to drop into

negative territory, albeit very briefly.

- White and Red Sstg contracts reversed gains after Cunliffe's words, while

blues hold onto mild gains. Breakevens now touch wider, swaps spread mixed.