Gilts have opened sharply lower taking cue....>

GILTS: Gilts have opened sharply lower taking cue from falls in German Bund and

US tsys despite a quiet session in Asia as markets trade with a risk-on tone.

10-yr Gilt yield is 3.7bp higher at 1.420% according to tradeweb and is leading

the rest of the curve higher. 2s/30s is little changed at 110.8bps.

- Brexit concerns are rising once again with newswires reporting a open argument

between Brexit secretary David Davis and PM Theresa May over the contents of

temporary customs proposals or "Brexit backstop" which were expected to be

published today. There is concern that PM May has deceived the Brexiteers within

her 'war cabinet' on the paper.

- Some rather hawkish comments from know hawk McCafferty has added to the

possibility of the next rate hike coming in August with markets now seen pricing

in a 63.5% chance compared to a low of 25.5% last week.

- Will be interesting to see if known dove Ramsden in a speech later today can

row back some of this bearishness seen in last couple of days.