The long-end of the Gilt yield curve...>

GILT SUMMARY: The long-end of the Gilt yield curve has come under high pressure

this morning, in-turn steepening the the yield curve as markets dismiss

hard-line opening position of the EU in transitional talks and downgrade to UK

growth by the IMF, as market react positively to BoE plans to keep City of

London operating after it leaves the EU.

- 2-yr Gilt yield is +1.2bp higher at 0.47%, 5-yr +1.6bp at 0.756%, 10-yr +3.1bp

at 1.238% and 30-yr +3.5bp at 1.816% according to Tradeweb.

- BBC reports that the BoE is to release plans allowing European banks to

operate in the UK as normal post Brexit. The BBC has learned that banks offering

wholesale finance - money and services provided to businesses and each other -

would operate under existing rules, and it would apply even in a 'no-deal'

scenario. BoE is expected to release these plans at 1300GMT

- Barnier said Brexit transition can only go to end of 2020, would have to abide

by all EU rules and respect customs union. While IMF cut UK GDP to 1.5% y/y.

- Swap spreads are marginally tighter with exception of 2-yr which is 0.5bp

wider, while breakevens are 0.7bp to 2.2bp higher with curve steeper.