In stark contrast to the more..........>

GILT SUMMARY: In stark contrast to the more positive assessment recently

provided by UK Foreign Secretary Jeremy Hunt, the EU has indicated that Brexit

talks have been difficult and that there is not yet a solution to the Irish

backstop issue.

- Further ramping up pressure on MPs to support PM May's deal - particularly

those in the DUP - the Canadian aircraft manufacturer Bombardier has warned that

its production in Northern Ireland would be at risk in a no-deal scenario.

- Gilts opened stronger this morning with yields ~2.5-3.0bps lower on the day.

Current yield levels: 2-year 0.769%, 5-year 0.970%, 10-year 1.2598%, 30-year

1.752%. The curve has steepened marginally with 2s30s pushing up to 97.7bps from

a low of 96.7bps.

- The Jun-19 gilt future trades at 126.30 near the top of the day's range.

- Inflation breakevens have inched higher. The 10-year benchmark trades at

3.101% up from 3.076%.

- Short sterling futures are broadly 0.5-2.0 ticks higher with the strip

flattening slightly on the back of greens/blues outperforming.