VIEW: Late Friday saw Goldman Sachs note......>

GILTS: VIEW: Late Friday saw Goldman Sachs note that "the UK Gilt curve

steepened this week after the BoE increased the stock of QE by GBP100bn but

reduced the pace of purchases by a substantial amount (from GBP13.5bn per week

to around GBP4bn per week). In March, the MPC emphasized market functioning and

term premium compression as the key objectives of monetary policy. This week,

the MPC argued that better economic news and calmer financial markets justified

a slower pace of purchases. Overall, we think that it is expectation of the

stock of QE that matters more than the pace -implicitly, however, a sharp

reduction in the pace will lead to a reduction in expectations of the total

stock. On balance, we expect curve steepening to continue tactically, but that

ultimately the BoE will return to QE, and we expect an additional GBP100bn of

gilt purchases in November. Also supporting a steeper curve is the ongoing

discussion of negative rates; while it was absent from the BoE meeting minutes,

Governor Bailey reiterated in the press briefing that negative rates were under

review."