Gilts are trading a little stronger....>

GILT SUMMARY: Gilts are trading a little stronger early Wednesday ahead of UK

inflation data and the US Fed decision later.

- The Mar 19 Gilt future is up 24 ticks at 123.33, having traded in a range of

123.07-123.37 today.

- The 2-Yr yield is down 0.8bps at 0.741%, 5-Yr is down 1.2bps at 0.895%, 10-Yr

is down 1.3bps at 1.267%, and 30-Yr is down 1.2bps at 1.779%.

- The focus in Brussels is Italy rather than Brexit, with Rome and the EU

reportedly to announce they have reached a budget accord.

- Italian bonds rallying. Not much sign of risk-on in Bunds or indeed Gilts.

- Government to release post-Brexit immigration plans later.

- UK Nov CPI released at 0930GMT (as well as ONS House Price Index).

- CPI was 2.4% y/y in October, core 1.9%. With the sharp decline in oil prices

in November, there could be a downside surprise (Surv 2.3%, core 1.8%).

- RPI seen at 3.2% Y/Y (Oct: 3.2%), PPI at 3.0% (3.3% Oct).

- US Fed up later today - will be putting out a piece shortly showing the

extremes to which UK rate futures are priced vs US over Q1 2019-Q1 2021.