Economy

WEST PALM BEACH, Florida, SAN FRANCISCO (Reuters) -Prominent investor Scott Bessent met with Donald Trump on Friday as he and fellow investor John Paulson emerge as leading candidates for the key role of U.S. Treasury Secretary, according to two people close to the president-elect. Bessent and Paulson are among several names that have been reported in the media as potential candidates for the role in recent days. A final decision rests with Trump, and Reuters was unable to learn whether others had been ruled out or were still in contention.One of the two sources said Bessent’s meetings at Trump’s Mar-a-Lago Florida estate were “very positive.” Trump’s spokespeople did not respond to a request for comment. Spokespeople for Bessent and Paulson declined to comment. It was unclear whether Paulson had met or had plans to meet with Trump. Trump, who is set to return to the White House on Jan. 20, has begun the process of choosing a Cabinet and selecting high-ranking administration officials. The Treasury Secretary job is a key Cabinet position, with vast influence over economic, regulatory and international affairs. Wall Street has been closely watching who Trump will pick, especially given his plans to remake global trade through tariffs. Bessent and Paulson, both financial backers of Trump’s campaign, have long been in Trump’s sights for such a role. During a January campaign speech, Trump floated Paulson as a potential Treasury Secretary. A source familiar with the matter at the time said Trump wanted Paulson to lead Treasury, and if not him, Bessent.A longtime hedge fund investor who taught at Yale University for several years, Bessent has a warm relationship with the president-elect and has spoken highly of Trump’s use of tariffs as a negotiating tool. Paulson, a billionaire investor and major Trump donor, is a longtime proponent of tax cuts and deregulation. Other names that have been speculated about for the role are FOX Business Network personality Larry Kudlow, Trump’s former U.S. trade representative Robert Lighthizer and Howard Lutnick, the co-chair of Trump’s transition team. Corporate attorney Jay Clayton, former head of the U.S. Securities and Exchange Commission during Donald Trump’s presidency, is meanwhile in talks for several potential roles in a second Trump term, although is seen as less likely for Treasury Secretary. JPMorgan Chase (NYSE:JPM) CEO Jamie Dimon, who has also been speculated, has no plans to join Donald Trump’s administration, a source said earlier this week.According to online betting website Polymarket, Bessent is the lead candidate for Treasury Secretary, with Paulson next likely and Clayton and Kudlow at smaller odds.Trump on Thursday announced that Susie Wiles, one of his two campaign managers, will be his White House chief of staff, in what is expected to be a flurry of staffing announcements.  More

“Positive labour market trends boosted by strong net migration and reform, improved competitiveness, and the absence of macro-financial imbalances, underpin Fitch’s assessment that Spain will continue outperforming its eurozone peers over our forecast horizon,” the agency said, maintaining Spain’s rating at “A-“.The country has been a bright spot in the euro zone, supported by a buoyant tourism-driven service sector and resilient manufacturing, while sluggish industrial demand took a toll on the rest of the region.The Spanish economy grew at a faster-than-expected rate of 0.8% in the third quarter this year from the previous three months, and 3.4% year-on-year, outpacing its European peers.Fitch on Friday projected Spain’s real GDP to grow at 2.9% in 2024, with average growth of 2.2% in 2025 and 2026. However, challenges remain as Socialist Prime Minister Pedro Sanchez relies on a fragile alliance with smaller parties to pass legislation, increasing policy implementation risks.The Sanchez administration is banking on tax reform to achieve its medium-term fiscal targets but will face expenditure pressures, Fitch said. More

LIMA (Reuters) -Peru and China will sign an updated free-trade agreement during President Xi Jinping’s upcoming visit to the Andean nation that would boost commerce by at least 50% between the countries, Peru’s foreign minister said on Friday.In an interview with Reuters, Minister Elmer Schialer said the Chinese president would travel to Peru with a delegation of 400 business people interested in investing in infrastructure and technology projects in the country.The free-trade agreement was originally signed in 2009 and the “optimized” version will be signed alongside 30 other agreements designed to improve cooperation between the countries.”China is our main trading partner, experts say this will increase that dynamism by at least 50%,” Schialer said. Bilateral trade between the two countries reached nearly $36 billion last year according to data from the Peruvian Ministry of Commerce.China has large mining and infrastructure projects in the country, including the Chancay mega port by Cosco Shipping Port.”The port will launch Peru to another level of trade,” Schialer said. The port will be “virtually” inaugurated by Peruvian President Dina Boluarte and Chinese President Xi Xinping from the government palace in Lima on Nov. 14.Schialer added that Peru’s portfolio of mining projects totals $54 billion while its infrastructure projects yet to be developed total $157 billion. He noted that “China is particularly interested” in these projects.The minister said he doesn’t expect changes with the United States given the recent election of President-elect Donald Trump.”The only thing we hope for and are sure that will happen is an expansion of the United States’ presence in investments,” he said, adding that both the outgoing and incoming US administration have “given us clear signals of interest” in terms of investment. More

Here are some of the contenders for several posts overseeing regulation and enforcement.Commerce DepartmentLINDA MCMAHONMcMahon is seen as a top contender for Commerce secretary. She served as head of the Small Business Administration in the first Trump administration and is chair of the pro-Trump America First Action (WA:ACT) super political action committee. She serves on the board of social media platform Truth Social, and is a major Trump donor.ROBERT LIGHTHIZERA loyalist who served as Trump’s U.S. trade representative for essentially the president-elect’s entire first term, Lighthizer will almost certainly be invited back. He is considered a contender for the top jobs at Treasury, the Commerce Department and the U.S. Trade Representative’s office. Lighthizer is a firm believer in tariffs and was one of the leading figures in Trump’s trade war with China.VIVEK RAMASWAMYA Republican presidential candidate until he dropped out of the race in January, Ramaswamy is a potential choice for the top job at Commerce. The multi-millionaire former biotech executive gained fame in right-wing circles thanks to his 2021 bestseller “Woke, Inc.,” which decries decisions by some big companies to base business strategy around social-justice and climate-change concerns.NAZAK NIKAKHTAR Nikakhtar was formerly an assistant secretary and acted as under secretary for the Bureau of Industry and Security during the first Trump administration. She is being considered for a senior post at the Commerce Department, which oversees export controls that have been used by Washington in the U.S.-China tech war. She is a lawyer and currently chairs the national security practice at Wiley Rein.AntitrustGAIL SLATERA policy advisor to Vice President-elect JD (NASDAQ:JD) Vance, Slater is viewed by antitrust attorneys as a top candidate to lead the Federal Trade Commission. Slater previously advised Trump on data privacy and telecommunications, and held roles at Fox Corp (NASDAQ:FOXA) and Roku (NASDAQ:ROKU). Before that, Slater was at the FTC for 10 years, including as an advisor to then-Commissioner Julie Brill (AS:BRIL), who is now an executive at Microsoft (NASDAQ:MSFT).MELISSA HOLYOAKOne of the FTC’s two current commissioners, Holyoak is a possible pick for acting chair. She was Utah’s solicitor general, and previously led the Hamilton Lincoln Law Institute, a conservative non-profit law firm focused on free speech and limited government.ANDREW FERGUSONThe other Republican on the FTC, Ferguson is another potential candidate for top antitrust roles. He was previously chief counsel to Republican Senator Mitch McConnell and clerked for U.S. Supreme Court Justice Clarence Thomas. Both Ferguson and Holyoak voted against some of the agency’s initiatives under chair Lina Khan, including a rule that would make it easier to cancel subscriptions and ban non-compete agreements.ANDREW FINCHFinch, a former deputy in the Department of Justice’s antitrust division under Trump who expressed skepticism towards “drastic calls for breaking up firms or turning tech platforms into regulated utilities,” could be a contender to lead the division. Finch is a partner at Paul Weiss where he has represented Spirit Airlines (NYSE:SAVE), Uber Technologies (NYSE:UBER) and Mastercard (NYSE:MA) in merger reviews.BARRY NIGROA former antitrust official at the DOJ and FTC and partner at Fried Frank, Nigro is another potential candidate. Nigro handled the DOJ’s review of T-Mobile US (NASDAQ:TMUS) Inc’s $26-billion takeover of Sprint Corp in 2020 and pharmacy-chain CVS Health Corp (NYSE:CVS)’s $69-billion acquisition of health insurer Aetna Inc (NYSE:AET).CybersecurityJOSHUA STEINMANA protégé of former Trump National Security Adviser Gen. Michael Flynn, Steinman played a key role in the first Trump administration’s aggressive stance on government hacking operations and is a contender for a senior cybersecurity position.Federal Communications CommissionBRENDAN CARROne of two Republican members of the Federal Communications Commission, Carr is a likely pick for acting chair of the FCC (BME:FCC) – and a potential permanent chair. He has been a supporter of Elon Musk’s efforts to win subsidies for broadband internet service and criticized NBC for letting Vice President Kamala Harris appear on “Saturday Night Live” just before the election. More

The company, which has been grappling with a deteriorating market for residential solar in Europe, will focus contract manufacturing in four existing locations – two in the US, one in India and one in China. The company will cease its contract manufacturing operations in Guadalajara, Mexico, it added. Enphase’s shares have fallen close to 50% so far this year, with demand for its services weighed down by lower electricity prices and greater competition in key markets such as the Netherlands and Germany. Enphase will incur about $17 million to $20 million in restructuring and asset impairment charges, of which about $14 million would be in the fourth quarter of 2024. The total cash expenditures would be about $11 million to $12 million. The latest move comes after the company unveiled previous job cuts in December last year, when Enphase said it would reduce its global workforce by about 10%, impacting about 350 contractors and employees. “The ongoing challenges from a tough 2023 solar market have continued to impact us and our industry partners throughout 2024,” CEO Badri Kothandaraman said in a message to employees, which was disclosed in a regulatory filing.”A combination of factors — including reduced U.S. residential solar demand due to high interest rates and declining demand in Europe due to policy changes and utility rate adjustments — has contributed to sustained unpredictability in our industry.” Enphase said its adjusted operating expenses in the fourth quarter are expected to increase as a result of restructuring plan. The company expects to reduce its adjusted operating expenses to a range of $75 million to $80 million a quarter in 2025. It expects to substantially complete these restructuring actions by end of the first quarter of 2025. More

“A Republican clean sweep will lead to easier U.S. fiscal policy, which should mean fewer rate cuts by the Fed,” strategists from Alpine Macro (BCBA:BMAm) led by Harvinder Kalirai said in a recent note.The post-election bond market reaction has left some scratching their heads as yields on Treasuries moved higher.While some on Wall Street have interpreted this move as potential loss of investor confidence, the strategists believe it’s quite the opposite. “Yields are rising on stronger U.S. growth expectations,” they said. Higher Treasury yields are a “reflection of stronger growth expectations, which are attracting more capital inflows and pushing up the dollar.”A Republican clean sweep  would likely put Trump in a “stronger position to push his economic policies forward,” they said.”At minimum, it would mean that the 2018 tax cuts that are scheduled to expire at the end of next year will be extended,” they added.Against the backdrop of a stronger economy and less easing by the Fed, the steady state for 10-year Treasuries could be near 4.5%, assuming a nominal R-star, or neutral rate of 4%, and term premium of around 50 basis points, souring investor appetite to increase duration, or bet on stronger bond prices.   In FX, the strategists are now shifting their long USD/JPY, GBP/USD, and AUD/USD positions from against the dollar to the euro.”All three central banks should be less dovish than the ECB,” they added. More

The spread on the ICE BofA U.S. Corporate Index, a commonly used benchmark for high-grade debt, declined to 78 basis points on Thursday, its lowest since 1998. Spreads were at 86 bps at the end of last month.Meanwhile, spreads in the ICE BofA U.S. High Yield Index, which tracks so-called junk bonds, dipped to 273 basis points on Thursday, their lowest since 2007, down from 288 bps at the end of October, LSEG data on Friday showed.The moves come amid a sharp rally in equities markets after Trump won a second term as U.S. president in Tuesday’s election. His policies are largely expected to benefit corporations due to lower taxes and looser regulation.The S&P 500 briefly touched the psychologically significant 6,000 mark for the first time on Friday.Investment-grade credit index spreads narrowed 8 basis points over the week, which was the largest weekly narrowing for the index since June 2023, Daniel Krieter, director of fixed income strategy at BMO Capital Markets, said in a note on Friday.  More