Gilts managed to avoid the selling.....>

GILT SUMMARY: Gilts managed to avoid the selling in the EGB space early in the

European morning but managed to participate in their recovery later in the

afternoon. As a result, Gilts were among the best performers of the major debt

markets over the course of Monday.

- There was little in the way of fresh information with a benign Halifax house

price index offering the only economic news and there were no Bank of England

speakers.

- Sterling weakened in the afternoon, notably against a more resurgent dollar.

- The 10Y Gilt yield fell 2.5bp by the close of play to 1.15% and very close to

one month lows. There was a fairly parallel movement across the yield curve.

- Breakeven rates were close to unchanged and the entirety of the yield curve

shift was in real yields, which is not the best set up for the GBP1bln 2026

index linked Gilt auction tomorrow.