Providing a sense of how Boris.........>

GILT SUMMARY: Providing a sense of how Boris Johnson will approach EU withdrawal

negotiations, the new prime minister has stated that the Irish backstop should

be completely removed. Specifically, Johnson stated: "A time limit is not

enough. If an agreement is to be reached, it must be clearly understood that the

way to the deal goes by way of the abolition of the backstop."

- In a bid to appease some Remain-leaning MPs and build some goodwill with

Brussels, Johnson has promised EU citizens 'absolute certainty' on their legal

rights. However, this is unlikely to be sufficient to make much headway in

breaching the current impasse.

- The Sep-19 gilt future trades at 131.83, 26 ticks off the day's low; L-H:

131.57-132.58. Gilts have sold off with yields 3-4bps higher on the day. Cash

yields (Last / 1d chg / L..H): 2Y (0.4968% / +2.6bp / 0.452%...0.5193%); 5Y

(0.4903% / +2.9bp / 0.4387%...0.5103%); 10Y (0.7083% / +3.1bp /

0.6498%...0.7277%); 30Y (1.3555% / +4.1bp / 1.3044%...1.3672%).

- The short sterling futures strip has steepened: W (- 1.0/2.0 ticks); R (-

2.5/3.0 ticks); G (+ 3.5 ticks); B (+ 3.5 ticks).