Professor Jeremy Stein is an expert in the movement of stock prices, risk management and banking, while Jerome Powell was a former undersecretary for finance under the president George H.W. Bush.
“Their distinguished backgrounds and experience coupled with their impressive knowledge of economic and monetary policy make them tremendously qualified to serve in these important roles,” Obama said in a statement.
If approved by the Senate the appointees would fill two long-vacant slots on the seven member Fed board.
Filling them has been a challenge for Obama.
In June Nobel Prize winner Peter Diamond withdrew his candidacy after waiting 14 months for the Senate’s nod.
Republicans had held up approval of his nomination, saying Diamond did not have appropriate experience or policy stances.
The new nominees include one Democrat and one Republican, which analysts say might assuage Republicans.
Stein already served in the Obama administration for six months in 2009 as a member of the White House National Economic Council and an advisor to the Treasury.
He teaches courses in finance at Harvard and previously worked at the Massachusetts Institute of Technology Sloan School of Management. He is also a member of the New York Fed’s Financial Advisory Roundtable.
Powell would be the only member of the Fed board with Wall Street experience.
He was a lawyer and investment banker in New York before joining the Treasury. Later he was a partner of The Carlyle Group, the private investment group the first president Bush was associated with.
He is currently a visiting scholar at the Bipartisan Policy Center in Washington, where he focused on fiscal issues at the state and federal government levels.
Analyst Michael Gapen at Barclays Capital said neither appeared to have a particularly fixed view of how monetary policy should be conducted.
“If approved, (we) would view them as voting in line with the chairman and vice chair regarding the implementation of policy through the federal funds rate, asset purchases, and other unconventional policy measures,” he said.
Obama made the nominations while on vacation in his native state of Hawaii.