Gilts are trading modestly lower led...>

GILT SUMMARY: Gilts are trading modestly lower led by the 10-yr sector following

early morning sell-off as markets looked ahead to key central bank meetings and

dismissed growing Brexit concerns. 2s/10s spread has steepened by 2.8bp and

10s/30s has flattened by 0.3bp.

- 2-yr Gilt yield is +0.6bp at 0.772%, 5-yr +2.3bp at 1.051%, 10-yr +3.2bp at

1.318%, 30-yr +2.8bp at 1.765% & 50-yr +2.5bp at 1.614% according to Tradeweb.

- Sep Gilt future actually opened higher, but very quickly came under selling

pressure and fell into negative territory as markets looked ahead to key BoJ

monetary policy decision tomorrow and then the Fed on Wednesday and the BoE on

Thursday. A 6,335 G U8 block at 123.18 twenty-five minutes after Monday's start,

which appeared to be a sale also weighed heavily on market sentiment. 

- There has been some profit taking in last 40 minutes or so which has lifted

Gilts from there lows though. G U8 last 33 ticks lower at 122.81 after hitting

intra-day low of 122.66

- Short sterling futures are steady to lower, strip steeper as blue contracts

falls by 3 to 4 ticks. 30-yr breakevens are 1.2bp wider