In the end the speech by Fed Chair.....>

GILT SUMMARY: In the end the speech by Fed Chair Yellen was a little bit of a

let down, concentrating on financial regulation and not commentating on current

monetary policy. This helped underpin bid in Gilts that started an hour earlier,

and to slightly bull steepen the yield curve.

- 10-yr Gilt yield is 0.5bp higher at 1.062%, while 2-yr is 0.3bp lower and

30-yr 0.2bp higher, according to Tradeweb.

- Gilts opened little changed, however quickly slipped lower in light volume as

2 of 3 German IFO numbers ticked higher and then large selling in Bobl and Bund

futures saw Gilts spike lower. 

- Latest Citi/YouGov inflation expectations were released showing a tick higher

in both year-ahead (2.6% vs 2.5%) and 5-10-year ahead CPI (3.2% vs 3.1%),

however, this had very little impact on the Gilt curve.

- Gilts traded in lower range as NY session got underway, but small buying in

illiquid markets saw prices recover an hour ahead of Yellen's speech.

- UK breakevens are not doing too much either with spreads around 1bp wider,

while there has been little movement in swap spreads.