Gilts rise as markets eye dovish stance from likely Fed chief

LONDON: British government bonds rose about 40 ticks shortly after the main trading session started on Monday, driven by the withdrawal of Lawrence Summers from consideration to succeed Federal Reserve Chairman Ben Bernanke.

Initial market reactions reflected views that the central bank's next chief would be more likely than Summers to extend an era of easy money. His withdrawal on Sunday appeared to open the door for the nomination of Fed Vice Chair Janet Yellen.

"We are assuming based on her speeches, that interest rates will remain lower for longer," Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ, said in a note.

At 0713 GMT, December gilt futures were 35 ticks up on the day at 108.66, off a session high of 108.78.