Gilts are trading modestly higher......>

GILT SUMMARY: Gilts are trading modestly higher Monday, with the yield curve

shifting lower by around 2bps as tension in the UK government rises once again

after a flurry of newspaper reports and revelations putting further pressure on

PM Theresa May. 10-yr Gilt yield is -2.1bp at 1.322%

- It seams like a day doesn't go past without there being another "crises" in

the government, this time, according to the Times 40 conservative MPs have

signed a letter of no-confidence in Theresa May, only 8 short need to force a

leadership challenge. The Daily Mail broke news of a private letter from Boris

Johnson and Michael Gove to Theresa May delivering their version of Brexit, with

renewed calls for them to be sacked. While the FT reported David Davis saying

there will not be an offer of a new Brexit bill to unlock talks, putting further

doubt the UK will be able to meet the December deadline to move talks on.

- The tension is seen building as the European Union (withdrawal) Bill goes to

committee stage tomorrow where there are a large number of amendments which the

government would like to put down but is struggling to get enough support from

its own MPs.