U.S. President Barack Obama will nominate Harvard economist Jeremy Stein and Jerome Powell, an investment banker and former Treasury official, to the two empty seats on the Federal Reserve's policy-setting board of governors.

The White House's pick of candidates, who have Democratic and Republican credentials respectively, may help speed their nomination through Congress when the U.S. economy faces a period of frustratingly slow improvement that has failed to put a major dent in the unemployment rate, now at 8.6 percent.

While neither have laid out detailed views on monetary policy, Stein wrote a paper earlier this year suggesting he would back the Fed's unconventional efforts to keep down long-term borrowing costs, which have been controversial in Washington. The Fed for over three years has adopted an array of radical measures to keep interest rates low and spur recovery.

Stein, who previously worked for the Obama administration as an adviser to the Treasury secretary and a National Economic Council staff member, specializes in stock price behavior, corporate investment and financing decisions, risk management and capital allocation inside firms. He declined comment on his nomination.

The choice of Powell, who served at the Treasury during President George H. W. Bush's term in the late 1980s and early 1990s, could be aimed at mollifying Senate Republicans. They blocked Peter Diamond, a Massachusetts Institute of Technology economist, saying the Nobel prize winner was not qualified for the job and he was too sympathetic to government intervention in the economy.

Powell is a lawyer by training and worked at Dillon, Read and Bankers Trust Co. after leaving the senior Bush administration and before joining Carlyle Group.

Powell is currently a visiting scholar at the Bipartisan Policy Center in Washington, focused on federal and state fiscal issues. He was not immediately available for comment.

Both Stein and Powell had already been flagged in various press reports as likely nominees.

In response to a deep recession and financial crisis, the Fed slashed interest rates to near zero and sharply expanded its balance sheet to some $2.8 trillion to keep the economy afloat. Some analysts worry the Fed's asset purchases could make it harder for the central bank to tighten monetary policy when it decides the time is right.