International Monetary Fund managing director Horst Koehler announced this evening he was resigning to accept a nomination to become German president.
'I want to tell you that I am deeply honored to be nominated for the office of the federal presidency of Germany,' he said at the IMF headquarters in Washington.
'I accepted this nomination today and according to the rules of the IMF, I have to resign immediately with the acceptance of this nomination, so I resigned today,' he said.
He added that his first deputy managing director Anne Kreuger would replace him on an interim basis.
The 61-year-old managing director of the International Monetary Fund is seen as succeeding German President Johannes Rau on July 1 with a five-year term after the majority parties in the German federal assembly agreed to support the economist.
Koehler, who took up his IMF position in 2000 with a five-year mandate, followed Frenchman Michel Camdessus, who took the post in 1987 and left during his third term.
But the prospect of Koehler's sudden move left IMF watchers wondering if tradition would be respected and another European named to replace him.
It remains to be seen how other countries will react to Koehler's proposed successor at the IMF, which aims to promote monetary cooperation and economic and employment growth but has been sharply criticised for its handling of recent financial crises in developing countries.
Since the founding of the IMF and the World Bank in 1944, the managing director of the IMF has by custom been a European and the president of the World Bank an American.
