Jack Lew the new Treasury Secretary

"He is a low-key guy who prefers to surround himself with policy experts rather than television cameras," Obama said.

Obama announced his nomination in the ornate White House East Room, flanked by Lew and outgoing Treasury Secretary Timothy Geithner.

The two men and their backgrounds illustrate the nation's changing economic landscape.

Geithner, a long time banking specialist with the Treasury and the Federal Reserve took office in 2009 at the height of the nation's financial crisis and Lew, the budget expert will do so as the government struggles with its debt and deficit challenges.

Obama heaped praise on Geithner for addressing the Wall Street meltdown and shepherding an overhaul of financial regulations through Congress.

Obama highlighted Lew's past work on economic policy, from his days in the 1980s as an aide to then House Speaker Tip O'Neill to his work on the budget with President Bill Clinton.

Obama said he felts "bittersweet" about losing Lew as his White House Chief of Staff but says "my loss will be the nation's gain."

"I trust his judgement, I value his friendship, I know very few people with greater integrity than the man to my left. And so I don't want to see him go because it's working out really well for me to have him here in the White House. But my loss will be the nation's gain," he said.

Over the past day, Lew has been getting a lot of attention for his loopy signature, which will be added to the US dollar bill if he is confirmed as Treasury Secretary.

Obama joked at Thursday's ceremony that Lew's nomination nearly fell through once he saw the almost illegible signature.

"I had never noticed Jack's signature. And when this was highlighted yesterday in the press, I considered rescinding my offer to appoint him. Jack assures me that he is going to work to make at least one letter legible in order to not debase our currency," the president said.

In selecting Lew to replace Geithner, Obama not only picks an insider steeped in budget matters but also a tough bargainer.

Some Republicans complain that Lew has been unyielding in past fiscal negotiations, particularly the failed talks for a large deficit reduction deal in the summer of 2011.

If confirmed, Lew would assume the post in time for the administration to tangle anew with Republicans over a confluence of three looming fiscal deadlines - raising the federal borrowing limit, averting automatic spending cuts to defence and domestic programmes, and the expiration of a congressional resolution that has been keeping the government operating.

"I think this shows that there is going to be a shift away from that financial crisis, financial market expertise that Geithner probably brought to the office and more to a budgetary concentration by the president. So I think from our perspective, this says that the president's priorities at Treasury are gonna move from financial restructuring and crisis fighting, into negotiating budget oriented issues and perhaps this grand bargain that we're gonna need to see happen between the Republicans and the Democrats to stabilise the US as a fiscal house," said Stephen Wood a Chief Market Strategist with Russell Investments in New York.

Lew's nomination is the fourth major personnel change in the administration since Obama's re-election.