Dr Philip Lowe, who has held the deputy position at the Reserve Bank of Australia (RBA) since 2012, will take over the top job from the current governor, Glenn Stevens, on September 18 this year. The appointment is for a seven-year term.
The widely expected change was announced by Federal Treasurer Scott Morrison.
A replacement for the deputy position will be considered in the second half of the year, the Treasurer said in a statement.
Mr Stevens has been RBA governor for 10 years.
In another announcement, Ian Harper has been appointed a part-time member of the Reserve Bank board for a five-year term from July 31 this year. This coincides with the conclusion of the term of John Edwards.
This week, the RBA cut the official cash rate (OCR) by 25 basis points to a record low 1.75%.