Gilts look set to end sharply higher...>

GILT SUMMARY: Gilts look set to end sharply higher supported by little change in

rhetoric at BoE, soft Eurozone PMIs and a sharp fall in EU/US equities on

renewed trade concerns. Yield curve is has pivoted around 10-yr point.

- 2-yr Gilt yield is -3.3bp at 0.89%, 5-yr -7.5bp at 1.178%, 10-yr -10.4bp at

1.422%, 30-yr -7.9bp at 1.726% and 50-yr -7bp at 1.498%.

- June gilt future initially sold off by around 25 ticks.in reaction to 7-2 MPC

vote to leave rates unchanged, however quickly regained lost ground and

eventually rallied to hit fresh highs as BoE minutes showed MPC in no rush to

raise rates and remained cautious on outlook for growth.

- Minutes also indicated MPC were happy with market view of future path of

interest rates which included a hike in May and for rate to be at 1.25% by end

of 2019.

- Risk-off sentiment later in the afternoon then pushed Gilts to session highs.

Elsewhere, retail sales rebounded in Feb offsetting some of the declines seen in

Dec and Jan, but remained subdued overall.

- Breakevens are mixed with 30-yr 1.5bps tighter & 2-yr swap spreads 2.6bp wider