Gilts fading lower once more with......>

GILT SUMMARY: Gilts fading lower once more with the yield curve shifting higher

by around 1bps as markets react to an article in the Times that says UK/EU

negotiators are close to a breakthrough on the Irish boarder issue which could

lead to EU offering a 2-yr transition deal as early as January. 10-yr Gilt yield

is 0.9bp higher at 1.361%.

- The pieces of the first phase of the Brexit negotiations seem to be coming

together ahead of key May/Juncker meeting on Monday which is hoped with give the

EU confidence that sufficient progress has been made so that talks can move onto

a transitional agreement and then quickly onto a trade deal.

- The deal could not come at a better time as latest survey from GfK shows that

consumer confidence fell back to match the level it hit in July 2016, following

the vote to leave the European Union.

- DMO announced its Gilt issuance plan for Q4 of 2017/18 fiscal year this

morning and plans to launch a new 10-yr on Mar 15.

- Looking ahead little data from the UK , so attention likely on any official

comments on progress of Brexit talks, Eurozone flash CPI and US data.