Dominique Strauss-Kahn has resigned as head of the International Monetary Fund, but maintains he is innocent of charges against him.
He is in Pikers prison in New York over the alleged sexual assault of a hotel maid at the weekend. He has been charged with committing a criminal sexual act, attempted rape, sexual abuse, unlawful imprisonment and forcible touching.
In his letter of resignation released by the IMF on Thursday, Mr Strauss-Kahn, 62, said he did so with "infinite sadness". He said he denied with the "greatest possible firmness" the allegations against him.
On Thursday, German Chancellor Angela Merkel reiterated that she wants a European to become the next head of the IMF.
Ms Merkel says with the resignation coming before the end of Mr Strauss-Kahn's term, there is an argument in favour of naming another European.
Mr Strauss-Kahn is one of France's most high-profile politicians and has been seen as a front-runner in next year's presidential elections. His arrest has shocked France.
Meanwhile, lawyers are preparing to return to court on Thursday to try to secure his release from Rikers Island prison on bail.
On Monday, a judge denied bail despite the offer of a $US1 million guarantee, saying there was a risk he would flee the country. France and the United States do not have an extradition agreement.
The BBC reports the defence will offer a new package that they hope will convince the judge that Mr Strauss-Kahn will not try to flee while he prepares his defence.
That could include Mr Strauss-Kahn offering to wear an electronic ankle tag, surrendering his passport and living under very restrictive conditions.
The 32-year-old maid has said she is "scared" but will testify against him.
