UK PM Theresa May faced a tough........>

GILT SUMMARY: UK PM Theresa May faced a tough examination of her proposed

withdrawal deal in front of the parliamentary select committee this morning. A

torrent of demanding questions has further exposed the challenges facing the

withdrawal bill when it is presented to parliament for the meaningful vote.

- There has been little reaction in the gilts market. The 2-year benchmark yield

trades at 0.731% up from a morning low of 0.697% and the 10-year trades at

1.343% up from 1.318%.

- The curve has flattened with the 2s10s spread narrowing to 59.99bps from

62.0bps and the 2s30s edging down to 125.7bps from 128.0bps.

- There has been little movement in inflation breakevens. 

- Cable currently trades at 1.2763 and remains on the back foot, with continued

demand for out of the money puts.

- The short sterling futures strip is broadly 1.0-3.0 ticks higher.