- The shorter end of the UK gilt.......>

GILT SUMMARY: - The shorter end of the UK gilt curve has traded sideways, while

yields at the longer end have drifted higher since early morning.

- The benchmark 2-year gilt has held within a 0.823/0.839% range, while the

10-year trades at 1.637% up from 1.618%.

- The curve has steepened with the 2s10s spread widening to 79.8bps from 77.8bps

and the 2s30s pushing up to 114.6bps from 112.3bps.

- The short sterling futures strip has steepened with whites/reds down 0.5-3.0

ticks and greens/blues down 4.0 ticks.

- Short sterling option flow has been relatively light so far. 

- The recent surge in inflation breakevens appears to have petered out with the

5-year trading at 3.159%.

- MPC member Gertjan Vlieghe delivered a speech at Imperial College Business

School where he reiterated that 1 or 2 BoE rate hikes a year is probably needed.