(Bloomberg) -- Some of President-elect Donald Trump’s key advisers are backing Scott Bessent, who runs macro hedge fund Key Square Group, as the best choice to serve as Treasury secretary, people familiar with the matter said.
Trump has not yet made a decision or offered the job to any candidate. But Bessent’s contributions during the campaign — from fundraising to helping write economic speeches and draft policy proposals — earned the president-elect’s respect, the people said.
The list of candidates narrowed on Tuesday when hedge fund billionaire John Paulson said in a statement that he was taking himself out of consideration. He cited his “complex financial obligations” which he said would prevent him from holding an official administration post.
Trump has been eyeing those with Wall Street pedigrees for the top Treasury job. Cantor Fitzgerald chief executive Howard Lutnick, who is helping run the president-elect’s transition, is also among the candidates whose names have been floated.
Through a spokesperson, Bessent declined to comment. The Trump team didn’t immediately return a request for comment.
But advisers have told Trump that Bessent would be a good pick from a markets perspective, and his recent op-ed in the Wall Street Journal — in which he noted that Trump’s election “drove the largest single-day increase in the US dollar in more than two years, and third largest in the last decade” — was well received inside the transition effort.
Bessent, who met with Trump on Friday, said he told the president-elect that “the dollar loves you and we keep increasing the after-tax return on US assets, and it’s going to keep going.”
“Long-term interest rates are coming down even with this growth shock,” Bessent said in an interview Monday with Fox Business. “The tax cuts, the deregulation, energy dominance, interest rates are actually going down, and the dollar is still going up.”
Trump’s Wall Street allies are urging him to appoint someone with deep finance industry knowledge to serve as Treasury secretary, advice that the president-elect’s team has indicated he’ll follow, according to people familiar with the process. A wide swath of tax breaks expire next year, giving Trump the opportunity to broadly shape fiscal policy as he did with his 2017 tax cuts.
The incoming Treasury head will face a mixed bag of challenges. The economy remains strong — with a long streak of faster-than-expected growth and an unemployment rate that’s still historically low — yet it’s also one where high prices remain top of mind for many Americans, as was clear in exit polls from the Nov. 5 election.
--With assistance from Nancy Cook, Bill Allison and Amanda Gordon.
(Updates with Paulson statement in the third paragraph)
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