Gilts are squeezing higher but in......>

GILT SUMMARY: Gilts are squeezing higher but in thin trade with the yield curve

bull flattening despite newspaper reports that the Cabinet has agreed to

increase the Brexit bill offer to the EU to beak the deadlock on talks. 10-yr

Gilt yield is 1.5bp lower at 1.268%.

- Newswires report that senior members of the cabinet have agreed to increase

its financial offer to the EU but on the condition that talks move onto a future

trade deal in December.

- Elsewhere Bank of England Deputy Governor for Markets and Banking Dave Ramsden

last night highlighted dampening effects of Brexit on the UK economy and that

could wait on wages and domestic cost growth before hiking rates.

- Looking ahead there is public sector borrowing numbers for October released at

0930GMT with consensus looking for around Stg7bln up from Stg5.9bln in

September. While the DMO tap 10-yr IL Gilt for Stg1.0bln, but is offset by large

IL Gilt redemption and coupon flows that total Stg12bln.

- BoE Cunliffe, McCafferty, Vlieghe & Saunders all appear in front of UK

Treasury select committee from 1000GMT to discuss latest inflation report.