Gilts are opening slightly bid in......>

GILT SUMMARY: Gilts are opening slightly bid in early Wednesday morning trade,

paring back some of the modest losses seen Tuesday with markets eyeing UK first

estimate of Q3 GDP data released at 0930BST. Markets also keeping an eye on

events in Europe (ECB) and US (Tax plan and Fed Chair announcement). 10-yr Gilt

yield is currently 0.5bp lower at 1.346%.

- MNI median forecast of analysts expectations is for Q3 GDP to remain steady at

+0.3% q/q and that it would take a very large downward surprise to alter the

view that the Bank of England is likely to raise interest rates next week.

- There was little direction seen overnight apart from slight change in odds for

the next US Fed Chair, with Taylor seen ticking higher, while there were

concerns over progress of US tax plan and weaker than expected Australian

inflation.

- There are also growing concerns from UK business over the likelihood of there

being no transition agreement between the UK and EU before the end of the year

which could effect investment and jobs.

- Both swap spreads and UK breakevens are little changed so far