Canadian Justin Trudeau said Monday he will step down as leader of the ruling Liberal Party but will remain as prime minister until a new leader is elected ahead of a general election in late October.

“I intend to step down as party leader and prime minister after the party selects its next leader through a robust nationwide competitive process,” he said during a news conference on Monday. “Last night I asked the president of the Liberal Party to start this process. This country deserves a real choice in the next election, and I have realized that if I have to fight internal battles, I cannot be the best option in this election.

He added that the Canadian Parliament would suspend its activities until March 24, pending a confidence vote.

“Parliament has been completely gripped by obstruction and filibusters and a complete lack of productivity in recent months. We are currently the longest-serving minority government in history and it is time for a fresh start,” Trudeau said.

The domestic press had reported that he was expected to announce his resignation before a key national caucus meeting on Wednesday. Canadian stocks rose slightly following the news. The S&P TSX index rose 0.1% and the Canadian dollar gained 0.5% against its U.S. counterpart to 1.4373. The iShares MSCI Canada ETF (EWC) rose 0.5%.

Canada’s latest political crisis was sparked by the sudden departure of former Trudeau ally and deputy and finance minister Chrystia Freeland, who resigned in December citing disagreements over Ottawa’s response to expected U.S. trade nationalism over the next four years under the new government President-elect Donald Trump appointed .

Dominic LeBlanc has since been appointed as her successor and head of the Treasury Department.

Trudeau, 53, who took office in 2015 and won re-election twice, suffered a drop in voter popularity to just 19% after Freeland’s departure, polling firm Abacus Data found on Dec. 17. Angus Reid made the announcement on December 30. It was a “painful year for the federal Liberals” and popular support for the party was just 16% – the weakest figure since the institute began tracking in 2014. Trudeau’s resignation leaves only one successor There are still a few months left to prepare for an election campaign.

The opposition Conservative Party is now leading by more than 20% in the polls ahead of the general election – and its fiery leader Pierre Poilievre has received the compliments of Trump ally Elon Musk, who recently praised his “great interview”.

Despite increasing calls for his resignation, Trudeau had rejected the move since mid-December, and the Liberal Party lacks a mechanism to oust its leader non-amicably.

In a new blow to Trudeau, Jagmeet Singh, leader of the allied left-wing New Democratic Party, announced in an open letter on December 20 that he intended to table a motion to overthrow Trudeau’s government, paving the way for an election.

“Justin Trudeau has failed in the most important job of a prime minister: working for the people, not the powerful,” Singh said, according to a CNBC translation. “Justin Trudeau’s Liberals made a lot of nice promises. Yet they have repeatedly let people down.”

Trudeau recently presided over a Canadian economy that narrowly managed to push inflation below its 2% target in November, but continues to suffer from household debt, rising unemployment, the worst productivity performance in the OECD in 2023 and panoptic commitment to the US is suffering – where President-elect Trump, who disparages “Governor” Trudeau, has already hinted at the possibility of 25% tariffs and annexation.

Differences over Canada’s response to Trump’s “aggressive economic nationalism” finally separated Freeland from Trudeau last month.

“We must take this threat very seriously,” she warned in her resignation letter, emphasizing “the serious challenges facing the United States” and urging a resolute fight for capital and economic nationalism against “America First” economic nationalism To resist investments and the jobs they bring with them.

— CNBC’s Fred Imbert contributed to this report.