Gilts had largely been trending........>

GILT SUMMARY: Gilts had largely been trending lower through most of the session

but moved higher after a low offer-to-cover ratio of the BOE's long-date APF

purchases.

- Politics have been in focus today for the UK, with Frost and Barnier giving

updates on the UK-EU post-Brexit negotiations. Confidence that a deal can be

reached seems to be falling with both sides pointing to little progress on the

main sticking point of the negotiations. It is the level playing field and

fisheries that continue to cause problems with the EU insisting on ECJ oversight

for the level playing field as it involves EU citizens and the UK rejecting

this. Our political risk team believe if everything else can be sorted this

raises the probability that leaders can force through a deal in September (but

if there remain other issues on the table there may be too much to focus on at

once).

- We also heard from BOE's Haskel who is concerned that the economic recovery

could be held back by consumers' fears of infection.