Gilts have managed to recover about....>

GILT SUMMARY: Gilts have managed to recover about half the afternoon sell-off

that was caused by the large swings seen in US equities (and VIX ) and look set

to close modestly higher, with the 5-yr sector seen leading the way.

- 2-yr Gilt yield is -3.4bp at 0.602%, 5-yr -5.7bp at 0.973%, 10-yr -4.8bp at

1.509%, 30-yr -1.8bp at 1.938% and 50-yr -1.9bps at 1.715%.

- The DMO priced Stg2.75bln syndicated re-opening of 30-yr 2048 IL Gilt at real

yield of -1.475%. Order book was strong with over Stg16bln in orders.

- Breakevens have had a volatile session as well with 5-yr and 10-yr set to

close 1.9bp and 1.2bp wider, while the 30-yr is 2.6bp tighter likely weighed by

the syndicated supply.

- Swap spreads are also mixed with 2-yr 3.1bp wider at 34.9bps but 15-yr and

above tighter by around 1.5bps.

- 3-days of Brexit transitional talks get underway in Brussels today, but only

at a technical level, with the UK hoping a deal can be reached by the time of

the EU summit meeting on March 22. No press briefing is expected until Friday

were the UK is meant to clarify its future relationship with the EU.