Gilts are trading on the front foot,...>

GILT SUMMARY: Gilts are trading on the front foot, as hopes of an imminent

Brexit deal have faded somewhat, and Q3 GDP figures are awaited.

- The Dec 18 Gilt future is up 28 ticks at 121.46, having traded in a range of

121.39-121.51.

- Curve a little flatter out to 10-years: 2-Yr yield is down 2.2bps at 0.82%,

5-Yr is down 2.4bps at 1.12%, 10-Yr is down 2.8bps at 1.537%, and 30-Yr is down

2.1bps at 1.959%.

- Speculation of a Brexit deal in principle next week pushed back somewhat by

comments from DUP leader Arlene Foster, who said PM May's approach raises 'alarm

bells'. GBP weaker, Gilts stronger.

- Short Sterling up across the strip, Blues up most (3.0-4.0 ticks).

- Q3 GDP out at 0930GMT. GDP grew by 0.4% in Q2 and on a rolling 3M/3M basis by

0.6% in August. The MNI median points to Q3 GDP growing by 0.6%, however signs

of a softening are apparent. After flat m/m growth in August, analysts

anticipate growth of just 0.1% m/m in Sep - with risks tilted to the downside.