Despite UK PM Theresa May facing a.....>

GILT SUMMARY: Despite UK PM Theresa May facing a vote of no confidence this

evening, the market response has been limited. It is widely expected that May

will survive the vote. If she doesn't it is possible that Brexit will be

delayed, according to Justice Secretary Davidd Gauke.

- Gilts initially sold off after the open, but have since pared losses with

yields near the middle of the day's ranges. The 2-year benchmark trades at

0.677% and and the 10-year at 1.197% off a morning high of 1.2195%. 

- The curve has steepened with the 2s10s spread pushing up to 50.7bps from a low

of 48.6bps, while the 2s30s has traded up to 105.7bps from 102.8bps.

- Inflation breakevens have pushed higher throughout the morning with the 5-year

benchmark trading at 3.281% from a low of 3.227%. 

- Cable sold off following the announcement that the no confidence vote had been

triggered, but has since recovered and currently trades at 1.2529%.

- Short sterling futures are 0.5-1.0 ticks lower in whites and up 0.5-1.0 ticks

higher in greens/blues.