Gilts are opening modestly higher......>

GILT SUMMARY: Gilts are opening modestly higher Wednesday, underpinned by late

rally seen in US treasuries overnight and move higher in German Bunds in wake of

soft French PMI numbers. 10-yr Gilt yield is 3bp lower at 1.555% while curve is

ever so slightly flatter as long-end outperforms. 

- In domestic matters, there have been more Brexit related headlines this

morning with reports of Euro-sceptic Tory MPs setting out red-lines to PM May

ahead of key speech expected tomorrow. While Politico reports that David Davis

is to give UK's response to EU's transitional proposals in parliament today. 

- It is a busy day in the UK with both Labour market data and public borrowing

numbers crossing the wires at 0930GMT. Markets will be watching the wage data

and how large the budget surplus will be in the month of January. 

- Too add to the already busy calendar BoE Carney, Broadbent, Haldane & Tenreyro

appear all appear at the Treasury Select Committee hearing from 1415GMT to

answer questions on February inflation report. Any comments on timing of next

interest rate rise will be closely monitored.

- Markets also be preparing for release of Jan FOMC minutes after LDN close.