In a move that could send shockwaves through global financial markets, former President Donald Trump is reportedly considering hedge fund billionaire and close confidant Scott Bessent as his top candidate to lead the Federal Reserve.
Bessent, the founder of Key Square Group and a former official within the Trump administration, has emerged as the favoured choice to replace current Chair Jerome Powell, whose term is set to expire in 2026. This potential appointment is being viewed as a clear signal that a second Trump term would pursue a radically different approach to US monetary policy.
Who is Scott Bessent?
Scott Bessent is no stranger to high finance or to Trump's inner circle. He served as a special advisor on international economics during Trump's 2016 presidential campaign and was later appointed to a key role within the US Treasury's investment security committee.
His hedge fund, Key Square Group, manages a colossal $4 billion in assets. More importantly, Bessent has a long history of accurately predicting major economic shifts, most notably foreseeing the European sovereign debt crisis, which cemented his reputation as a macroeconomic visionary.
A Dramatic Shift in Fed Policy
The appointment of an outsider like Bessent would mark a significant departure from tradition. The Fed Chair is typically a respected economist or a seasoned central banker, not a hedge fund manager.
Financial analysts suggest a Bessent-led Fed would likely prioritise a strong US dollar and could adopt a more aggressive stance on interest rates. His close alignment with Trump's economic vision suggests a focus on policies that directly favour the former president's pro-growth, America-first agenda, potentially challenging the Fed's cherished independence.
Market Jitters and Political Reactions
News of this potential nomination is already causing a stir amongst investors and policymakers. The perceived politicisation of the world's most powerful central bank could introduce new volatility and uncertainty.
Such a decisive move would undoubtedly face intense scrutiny and a potentially contentious confirmation process in the Senate, highlighting the profound high-stakes battle for control over the US economy that a 2025 election win for Trump would unleash.
