Gilts are keeping pace with Bunds......>

GILT SUMMARY: Gilts are keeping pace with Bunds and outperforming USTs today,

but 10y yields are still over 10bps above the lows seen earlier this month.

- Moves today have not really been headline driven, but there has been a

spattering of political news. The Times this morning reported that Johnson is

considering holding a general election shortly after the Brexit vote as he

considers Labour vulnerable with Corbyn as leader, and thinks it would be easier

to defeat Corbyn than another Labour leader. Today also saw May take part in her

last PMQs while Brexit Secretary Barclay was reported to have said that a

no-deal Brexit is underpriced. In the least surprising news of all Johnson is

said to want a hard Brexiteer to run Brexit policy.

- UK inflation data was in line with expectations and saw very little reaction.

- Gilt futures are up 0.55 today at 131.11 with 10y yields down -5.2bp at 0.768%

and 2y yields down -3.9bp at 0.536%.