Once again majority of the move........>

GILT SUMMARY: Once again majority of the move lower happened at start of London

session as optimism on Brexit talks moving onto the nest stage notched higher,

however Gilts did find some support on soft Eurozone CPI. Yield curve is

slightly steeper as ultra long-end underperforms.

- 2-yr Gilt yield is +0.8bp at 0.535%, 5-yr +0.8bp at 0.840%, 10-yr +1.1bp at

1.363% and 30-yr +1.7bp at 1.912% according to Tradeweb.

- The pieces of the first phase of the Brexit negotiations seem to be coming

together ahead of key May/Juncker meeting on Monday which is hoped with give the

EU confidence that sufficient progress has been made so that talks can move onto

a transitional agreement and then quickly onto a trade deal.

- Gilt real yields have underperformed nominals with the 5-yr seen suffering the

most once again, likely weighed by expectation inflation will faded as Sterling

continues to strengthen against US Dollar and Euro. 5-yr breakevens are 4.2bp

tighter at 2.92% (fresh 3-month low) and adds to the 3.2bp tightening seen

yesterday.

- Swap spreads are tighter as well, led by 2bp fall in 15yr to 30-yr sector.