Updated 6:31 p.m. | Senate Finance Chairman Max Baucus will be tapped as the next ambassador to China, Democratic sources said Wednesday even as the retiring Montana Democrat played coy.

“There’s a lot of stuff flying around,” Baucus said. “That’s not for me to discuss.”

Baucus preferred to entertain questions from reporters about his tax code overhaul effort, but Finance’s ranking member, Orrin G. Hatch of Utah, said he had heard about the news of the ambassadorship “on good authority.”

“I understand it’s a done deal,” Hatch said. “I’m going to miss him if … that’s what they’re doing.” Hatch said the nomination should sail through.

“If it is true that the president has … made this choice, then he ought to be confirmed immediately. He’s a fine man. We all know him. We’ve known him for years and years, and it would be improper to not put him right through,” Hatch said.

A Democratic leadership aide and a Democratic official confirmed the news. Baucus would succeed former Commerce Secretary Gary Locke as the top U.S. diplomat in Beijing.

Congressional Democrats, some surprised by the news, speculated that by naming the retiring Baucus to the plum ambassadorship, the administration was trying to bolster its chances at maintaining the Senate majority in 2014.

Baucus’ retirement made Montana a key Republican pickup opportunity. But by leaving office early, Democratic Gov. Steve Bullock can appoint his immediate replacement.

Lt. Gov. John Walsh, who is already seeking the seat and has the backing of the national party, would be the obvious top choice. In that case, Democrats would hope that the incumbency advantage, even if his tenure is brief, could give them an edge in November 2014 against likely Republican nominee, Rep. Steve Daines.

However, that appointment is not a sure thing. For one, it could look like an overtly political move from a governor who will be up for re-election in 2016. It could make it appear that Bullock is taking sides in a Democratic primary.

Walsh faces a primary against former Lt. Gov. John Bohlinger and former banker Dirk Adams. He also currently enjoys the contrast of being a Washington outsider running against a sitting congressman.

Baucus’s nomination could also have some effect on a Senate race in Louisiana. By vacating his chairmanship of the Finance Committee, a domino effect could lead to Sen. Mary L. Landrieu taking over the gavel of the Energy and Natural Resources Committee. Energy production is vital to the Louisiana economy, and that post could at the very least produce a boost in fundraising for her competitive re-election.

The Democratic official offered several reasons, meanwhile, on why Baucus would be a good fit for the post, saying he had been working on U.S.-China relations for more than 20 years, has visited China eight times and has hosted numerous Chinese delegations both in Washington and in Montana.

Baucus pushed for China’s inclusion in the World Trade Organization in the 1990s and for the establishment of Permanent Normal Trade Relations.

“Baucus has been a loyal ally to American companies and citizens while being respectful and fair to the Chinese,” the official said.

Kyle Trygstad contributed to this report.