Gilts are trading mixed after paring...>

GILT SUMMARY: Gilts are trading mixed after paring opening losses, with the

10-yr to 30-yr sector remaining in negative territory while short end recovers,

weighed by move lower in US Tsys and comments from BoE Broadbent after London

close and 5-yr Gilt supply. 

- 2-yr Gilt yield is -0.5bp at 0.754%, 5-yr +0.2bp at 1.02%, 10-yr +0.7bp at

1.273% 30-yr +0.6bp at 1.718% & 50-yr +0.1bp at 1.563% according to Tradeweb.

- Broadbent said that he had not yet to decided if he will vote for a rise in

the interest rate next week but did defend use of QE and clarified that the Bank

would only start to unwind its balance sheet once rates reach 1.50%.

- Gilt future bounced off lows taking cue from recovery in German Bunds as EMU

PMI data was slightly weaker than expected. The recovery continued following

strong demand and small tail at the new 5-yr Gilt auction, however the 10-yr to

30-yr sector remain under pressure.

- Short sterling futures are steady to 2 ticks lower, curve little changed,

although MNI PINCH sees markets pricing in a 90% chance of a rate hike next week