As a member of the Board of Governors of the Federal Reserve since 2012, Powell has supported the Fed's ongoing strategy of gradually raising interest rates and may be friendly to the Trump administration's plan to roll back regulations on financial firms.
Senior Economist at UCLA Anderson Forecast David Shulman told ABC News that interest rates are currently much lower than normal and described the Fed's current strategy of bringing them back up as "normalization."
"His policies will be consistent with [current chairwoman Janet] Yellen on the monetary policy side," said Shulman. "And he's probably less hawkish on regulation."
Economists generally refer to those who favor stricter regulations and higher interest rates as "hawks" and those against as "doves."
Powell has deep roots in the Republican establishment as an assistant secretary and as undersecretary of the Treasury under President George H.W. Bush. Though Powell is known as a Republican, President Barack Obama appointed him for his first Fed position in 2012 and he was reappointed in 2014.
In addition to his government service, the native Washingtonian is also no stranger to Wall Street. Powell was a partner at private equity firm The Carlyle Group for eight years before leaving for the Bipartisan Policy Center as a visiting scholar until his appointment by Obama.
The nomination brings to a close a very public selection process by Trump.
In July, Trump announced he was considering a replacement to Yellen, a Democrat, after her four-year term ends in February -- potentially marking the first time since 1979 a chairman has not served at least eight years. However, despite pressure from Republicans to nominate their own leader of the central banking system, Trump has praised Yellen's service.
According to The Associated Press, Trump said in an interview with the Fox Business Network that Yellen was "very impressive. I like her a lot."
But the president added, "You like to make your own mark, which is maybe one of the things she's got a little bit against her, but I think she is terrific."
The Federal Reserve, among other things, controls the economy's interest rates. Higher interest rates mean a higher price to borrow money, but they also mean savings accounts earn higher interest. This is the Fed's most effective tool in steering the economy. The board and its chairman serve independently of the White House, so once a nominee is sworn in, Trump will have minimal influence over his or her decisions.
Shulman told ABC News the chairman not only serves as the central banker for the United States, but also as the spokesperson for the country's monetary policy and "for all practical purposes, is close to being the central banker for the world."
According to the senior economist, the most important nomination a president can make is to the Supreme Court, followed by "probably the chairman of the Federal Reserve."