It has been a busy week for short....>

SHORT-STERLING: It has been a busy week for short sterling futures with the

curve significantly steepening. At the time of writing, the curve had moved from

being inverted through the White/Red area to being flat throughout most of the

strip.

- The biggest driver of the week has been changing Brexit expectations. On

Monday the bill forcing the PM to ask for an extension to Brexit if no deal has

been agreed before the UK is due to leave was passed into law. Since then the

market has priced out the chance of future interest rate cuts and the curve is

now very flat.

- On Friday The Times ran a story saying that the DUP was preparing to back down

on its red lines in order to get a Brexit deal. Despite being denied, this

helped short sterling to see the biggest sell-off of the week.

- For the week, Whites are down 2-17.5 ticks, Reds down 19.5-24 ticks and the

rest of the strip is down 25-26.5 ticks.