Gilts are trading steady to modestly...>

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

seen pivoting around the 10-yr sector as markets react to weekend political news

(both domestic and European) and announcement that US has put China tariffs on

hold for now.

- 2-yr Gilt yield is -0.4bp at 0.815%, 5-yr -1.1bp at 1.168%, 10-yr -1.9bp at

1.481%, 30-yr -1.2bp at 1.892% and 50-yr -1.1bp at 1.686% according to TradeWeb.

- The Times reported that Conservative MPs are preparing for another snap

general election as they fear the Brexit deadlock will become insurmountable for

the prime minister. While in Italy reports that the 2 anti-establishment parties

have agreed on a nominee for a Prime Minister which is likely to be agreed by

the President has weighed on sentiment leading to a mild risk-off flows.

- The rally in the Gilt future was brought to an abrupt end when a Gilt future

block was sold (3,349 G M8 @ 121.76) and has traded sideways since.

- Short sterling strip is higher by 0.5 to 2 ticks, with curve modestly flatter

as green and blue contracts outperform whites. Breakevens are unchanged despite

slip in cable,while swap spreads are wider with exception of 2-yr