Dominguez—a public policy and economics professor at the University of Michigan—would represent the board's Chicago region.
"Dr. Dominguez has the proven experience, judgment, and deep knowledge of the financial system, monetary policy, and international capital markets to serve at the Federal Reserve during this important time for our economy," Obama said in a statement.
Dominguez also serves as a research associate at the National Bureau of Economic Research.
The White House said Dominguez would bring "expertise in foreign exchange rate behavior, emerging markets and international borrowing." It touted her ability to boost the Fed's response to global market issues.