Gilts have opened sharply lower weighed by....>

GILTS: Gilts have opened sharply lower weighed by a twin attack of 10-yr Tsy

yield rising above 3.10% level and news that the UK government is prepared to

remain in the EU customs union "beyond 2021" in order to try and resolve the

Irish border issue. 10-yr Gilt yield is 4.3bp higher at 1.546% according to

tradeweb, and is leading the rest of the curve lower.

- The Prime Minister's Brexit war Cabinet earlier this week agreed on a new

"backstop" as a last resort to avoid a hard Irish border, having rejected

earlier proposals from the European Union, according to the report in the

Telegraph.

- However it is far from clear if Brussels would agree to such an arrangement as

the UK looks to be able to agree trade deals during this time. 

- Back to the markets, short sterling strip has sold off with curve steepening

as green and blue contracts are 3 to 4 ticks lower, while whites are steady to 2

ticks lower.