Gilts are set to finish the week.......>

GILT SUMMARY: Gilts are set to finish the week sharply lower, with global

(largely US Tsy) yield rises weighing, combined with increasing optimism on

avoiding a no-deal Brexit.

- An initial spike in Gilt futures following a below-consensus US nonfarm

payrolls release was dashed as markets digested the release, eventually leaving

futures near day`s lows. The Dec 18 Gilt future is down 42 ticks at 119.76,

having traded in a range of 119.68-120.09 today.

- Ultimately, positive Brexit headlines have brought 5 and 10-Yr Gilt yields to

highest levels since Jan 2016. The cash curve is slightly steeper, with the 2-Yr

yield up 1.3bps at 0.899%, 5-Yr is up 2.7bps at 1.271%, 10-Yr is up 3.6bps at

1.705%, and 30-Yr is up 3bps at 2.032%.

- Short Sterling likewise looks set to end the week on the lows, with Green-Blue

contracts 6 ticks lower.

- Big development next week is that the House of Commons returns from party

conference recess, which could usher in further progress on Brexit.