* Nikkei report on Summers as next Fed chief lifts dollar
* U.S. Treasury yields extend gains as Fed meeting awaited
* World stocks slip for second day, miners knocked by gold
* Gold at five-week low as Fed liquidity curbs weigh
By Richard Hubbard
LONDON, Sept 13 (Reuters) - The dollar and U.S. Treasury yields rose on Friday on a Japanese report that Lawrence Summers would soon be named to head the Federal Reserve, as he would be expected to favour a faster cutback in its stimulus programme.
The White House, however, said no decision had been taken.
While traders had doubts about the source of the report in Japan's Nikkei business daily, analysts said its impact highlighted the sensitivity of investors to the possibility of Summers taking over at the Fed. Markets believe he might tighten monetary policy faster than the other main candidate, Fed Vice Chair Janet Yellen.
The dollar jumped as much as 0.3 percent against a basket of major currencies and 10-year U.S. Treasury yields touched a high of 2.957 percent, up from Thursday's close of 2.905 percent. World shares edged lower.
U.S. stock index futures were little changed after the White House denial. They pointed to a steady tone on Wall Street ahead of data on retail sales and consumer sentiment that should do little to change expectations that the Fed will cut back its stimulus measures next week.
Japan's Nikkei business daily, citing unnamed sources, said U.S. President Barack Obama would name the former Treasury Secretary to take over from Ben Bernanke after the U.S. central bank's policy meeting ending on Sept. 18, at which it is expected to start reducing its massive monetary stimulus.
Asked about the story, a White House spokeswoman said Obama had not made his decision about the Fed job.
"This morning the Summers story was the main event ... markets know Yellen is very dovish, so any candidate other than her would be dollar positive," said Lutz Karpowitz, currency analyst at Commerzbank.
Investors generally expect the Fed to announce a tapering of its monthly $85 billion of bond purchases next week in response to signs of growing strength in the U.S. economy, but the pace of future cutbacks is less clear.
"In the coming months given that the new Fed chairman starts in January, the Summers effect, if it is announced, could be as dominant (as the Fed's tapering decision)," said Mike Gallagher, managing director of IDEAglobal.
Gallagher said the combination of a Fed tapering decision next week and the prospect of Summers becoming chairman could set U.S. Treasury 10-year yields on a course towards 3.5 percent by year's end.
But a successful Summers nomination is far from certain, and any appointment must be approved by the U.S. Senate.
European shares were little changed though mining stocks were hit as metal prices suffered from the expected Fed stimulus curbs. Data showing a slower rate of decline in euro zone employment in the second quarter had little impact.
Earlier MSCI's broadest index of Asia-Pacific shares outside Japan shed 0.8 percent, pulling further away from a three-month high and on track for a second day of losses after a 10-day winning streak - its longest run in six years.
The Asian gauge is still up 2.2 percent this week.
In Tokyo, the Nikkei share average bucked the trend and edged up 0.1 percent on reports the government is considering lowering the corporate tax rate next year as part of efforts to soften the impact of a planned consumption tax hike.
In commodity markets, gold was on course for its worst week in two months after heavy selling linked to expectations of the Fed rollback and an easing of tensions over Syria.
"This is almost certainly the pricing in of the expectations of QE tapering," Mitsubishi analyst Jonathan Butler said.
Gold, which was quoted at $1,311.75 an ounce, down 0.6 percent, has now lost around 19 percent this year.
Brent crude oil slipped to around $112.25 a barrel, on course for its biggest weekly loss in three months as the United States and Russia worked on a plan for Syria to surrender its chemical weapons.
"Since concerns on a possible U.S.-led military strike against Syria have eased, market participants are just waiting for the outcome of next week's Fed meeting," said Masaki Suematsu, Energy team manager at Newedge.