There have been two new significant....>

GILT SUMMARY: There have been two new significant twists to emerge in the Brexit

saga over the last 24 hours. First, the Speaker of the House John Bercow has

stated that there is an "arguable case" the government is in contempt of

parliament over its handling of key Brexit papers and a failure to publish its

full legal advice on Brexit. Second, the ECJs advocate general, Campos

Sanchez-Bordona, stated that EU law could allow a country to unilaterally revoke

article 50. This could strengthen the hand of MPs seeking to derail Brexit.

- Gilt yields have pushed steadily higher since the open, with the short-end

underperforming. The 2-year benchmark yield trades at 0.745% up from 0.691% and

the 10-year yield is up to 1.325% from 1.276%. The curve has flattened slightly

with the 2s10s spread narrowing to 57.0bps from 58.5bps.

- Inflation breakevens has pushed higher with the 5-year benchmark trading up to

3.197% from a low of 3.179%.

- Short sterling futures are down 0.5-2.5 ticks with the biggest moves seen in

reds/greens.