Gilts have been riveted Wednesday by...>

GILT SUMMARY: Gilts have been riveted Wednesday by the Conservative Party's

no-confidence vote in PM May which is set for this evening.

- The Mar 19 Gilt future is down 52 ticks at 123.57, heading lower throughout

the day largely reflecting rising perceived odds of May winning.

- Likewise, bear steepening in the cash curve: the 2-Yr yield is up 2.7bps at

0.717%, 5-Yr is up 4.1bps at 0.862%, 10-Yr is up 5.7bps at 1.245%, and 30-Yr is

up 6.6bps at 1.791%.

- At last check, Reuters had reported at least 185 Conservative MPs had publicly

indicated support for May in the vote, above the 159 threshold.

- While this count should be taken with some scepticism, as it is a secret

ballot, implied betting odds (ie Betfair) have May at 90+% likely to win.

- Hearing from some MNI clients though that this overstates May's chances, and

that either it will be too close for her to carry on, or she will lose outright.

- The vote is between 1800-2000GMT. Results expected around 2100GMT.

- No key UK data for the rest of the week.