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UK gilts opened on the back foot, but have....>

GILTS
GILTS: UK gilts opened on the back foot, but have since reversed losses to now
trade  a touch higher with yield falling circa 0.4bp across the curve as markets
digest latest Brexit vote in the House of Commons and look ahead to key UK
inflation data for June. 10-yr Gilt yield is 0.2bp higher at 1.259%.
- Last night the Tory government managed to see off a pro-EU amendment to the
Customs Bill, however, it opened up further divisions within the Conservative
party and PM May is far from safe.
- The next crucial Brexit update is likely to be this Friday when the latest
round of talks held this week are summed up.
- Main event today will be the release of UK inflation for June, with consensus
seeing prices rising by 0.2% m/m with the yearly figure increasing to 2.6% from
2.4% due to rising fuel prices. Once again any 0.1bp miss in either direction is
not seen changing the likelihood the BoE will raise rates in just over 2-weeks
time.
- Sstg strip is little changed in very low volume.

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