Gilts have faded earlier flight-to-quality....>

GILTS: Gilts have faded earlier flight-to-quality bid move higher in wake of

solid UK data and on news that a buyer has been found for troubled House of

Fraser store. Yield curve has pivoted around the 10-yr area with 2s/10s 1.6bp

flatter and 10s/30s 0.9bp steeper.

- 2-yr Gilt yield is -1.4bp at 0.725%, 5-yr -2.9bp at 1.01%, 10-yr -3.2bp at

1.269%, 30-yr -2.3bp at 1.735% & 50-yr -2bp at 1.585% according to Tradeweb.

- Sep Gilt future opened sharply higher supported by the flight-to-quality bid

seen at start of London trade following meltdown in the Turkish Lira and rising

tension between Russia and US.

- Gilts faded the higher move just ahead of raft of UK data and then slipped

lower as flash Q2 GDP came in-line with consensus at 0.4% q/q, while industrial

production came in better than expected. News that Mike Ashley, owner of Sports

Direct, buys troubled high street chain House of Fraser, appeared to added

further selling pressure to Gilts, despite further fall in Cable.

- Short sterling strip is flatter as blue contracts rise by 4 ticks, while white

contracts are mixed despite screen buying in Mar9 contract.