Short sterling markets have been.....>

SHORT-STERLING: Short sterling markets have been more driven by external factors

than Brexit rhetoric this week (phew) but whippy price action has seen a rally

through most of the week until Thursday's close before a fairly substantial

retracement on Friday.

- The initial trigger for the rally was primarily the deterioration in global

risk sentiment with the sharpest moves higher at the open on Wed with other

notable moves higher at the open on Thurs following the FX flash crash and again

on Thurs following the poor ISM manufacturing print out of the US.

- However Friday saw over half of the week's rally reversed following a very

positive US employment report. Whites are looking to close the week around

2.5-3.5 ticks higher, Reds and Blues 3.5-4.5 ticks higher while the biggest

weekly moves were seen in Greens which are around 4.5-5 ticks higher.

- The domestic agenda picks up again in the week ahead with Carney hosting an

online Q&A on Wed while the Brexit Select Committee will also give an update on

the Brexit negotiations also on Wed before parliament begins to debate the deal

again. On Fri the Nov GDP report will be released along with trade and IP.