IMF's Raghuram Rajan to step down

International Monetary Fund's chief economist Raghuram Rajan on Tuesday said he would be stepping down early next year to return to the University of Chicago where he had worked as a professor.

Rajan, the Economic Counselor and Director of the Research Department of IMF, who has been at the current post since July 2003, was offered a second term by the organisation but the university has declined to extend his leave, he said.

"When I took this job, I promised the Executive Board that I had every intent of staying the full three years that department directors are appointed for. That I have done. Recently, the Managing Director asked me if I would stay on for a second term. I checked with the University of Chicago, but they indicated their inability to extend my leave," the Indian-born economist said in a statement.

"I will stay on at the IMF through the end of the year to complete or substantially complete work that is in progress, including preparing a report on how to better integrate Financial Sector Analysis into the Fund's Article IV work."

Praising his "important contributions" to the IMF, its Managing Director Rodrigo de Rato said "Raghu's open management style and collegial spirit have worked to create an attractive work environment for his staff.

"Moreover, he has provided management and the Executive Board with many innovative and insightful perspectives on a wide range of policy and operational issues facing the institution... he will be missed by his many friends and colleagues at the Fund," de Rato added.