WASHINGTON – President Barack Obama on Monday will nominate longtime adviser Jason Furman to be his new chief White House economist, an administration official said.

Furman, who will replace economist Alan Krueger as chair of the White House's Council of Economic Advisers (CEA), has a Ph.D. in economics from Harvard University and has advised Obama since his 2008 election campaign.

Furman has been instrumental in formulating administration policies on taxes, the response to the U.S. recession, the formulation of a sweeping healthcare overhaul and efforts to avoid a "fiscal cliff" at the end of last year.

"Furman has been a key adviser to the president and has contributed to most every major proposal on jobs and the economy," said the White House official who declined to be identified. Obama will announce the appointment at 2:10 p.m. EDT.

Krueger, who was confirmed as CEA chair in November 2011, is returning to his professor post at Princeton University, from which he has been on leave. He had to return to the school by this fall in order to maintain his tenure, according to one source.

Furman is currently assistant to the president for economic policy and principal deputy director of the White House National Economic Council (NEC), which is run by Gene Sperling, and was an economist in the Clinton administration.

When former NEC head Larry Summers left the administration at the end of 2010, Furman was considered a possible replacement, but the post went to Sperling instead.

"He's as bright and able as any economist I've worked with," Summers said of Furman late last month after a source familiar with the matter told Reuters that Obama planned to appoint him. "I think he'll be terrific."

The CEA advises the president on domestic and international economic policy based on data and economic research. The chairman is a cabinet member and requires Senate confirmation.

Former colleagues said Furman would be effective because of his good relationship with the president and White House staff.

The appointment is likely a sign that budget and tax fights with Congress will continue to play a high-profile role in White House economic policy. It could also raise the profile of the CEA within the White House itself.