Gilts are trading mixed ahead of NY....>

GILT SUMMARY: Gilts are trading mixed ahead of NY open Tuesday with the

short-end of the curve having reversed earlier move higher, while the ultra

long-end holds onto slight gains, therefore flattening the yield curve.

- 2-yr Gilt yield is +0.4bp at 0.477%, 5-yr +0.3bp at 0.745%, 10-yr -0.3bp at

1.258% and 30-yr -0.3bp at 1.812% according to Tradeweb.

- Gilts opened modestly higher supported by move higher in US Treasuries

overnight and then extended gains despite encouraging words from BoE FPC

Financial Stability Report that showed UK Bank's would be able to withstand a

disorderly Brexit.

- The move higher was faded though led by reversal in the short-end of the yield

curve, however the 10-yr was supported by Stg100mln receiver in 10Y swaps.

- Gilts then came under pressure as DMO sold Stg400mln in 2060 Gilt mini-tender

and on newswire reports that Irish deputy Prime Minister has resigned, which is

likely to avoid fresh elections.

- Swap spreads are mixed with 2-yr and 5-yr circa 1.5bp tighter while other are

modestly wider. While 5-yr and 10-yr breakevens are 0.5bp wider.