RAMALLAH (AFP) -- The United States on Thursday shot down speculation Palestinian Authority premier Salam Fayyad is poised to offer his resignation to President Mahmoud Abbas after a dispute between the two.
Rumors the US-educated economist would either resign or be told to step down by Abbas have been rife in recent weeks following the high-profile dispute between the pair over the government's hiring and firing policy.
But a senior official at the US State Department poured cold water on the idea, telling reporters he did not believe Fayyad was on the verge of resigning.
"He's not tendering his resignation to the best of my knowledge. He's not doing it," the official said on the sidelines of G8 talks in London.
"As far as I know he's sticking around."
Abbas, who returned to Ramallah from Doha on Thursday, had been due to meet his prime minister for evening talks "to settle Fayyad's resignation," senior Fatah official Azzam al-Ahmad had told the Voice of Palestine radio.
But following the US official's remarks, the evening meeting was called off.
"The meeting planned for Thursday evening has been postponed until further notice," a Palestinian source told AFP, without giving a reason.
Earlier in the day, a Palestinian official had told AFP that Fayyad would present Abbas with a resignation letter that he wrote weeks ago.
"Fayyad has prepared a letter of resignation which he will present today to Abbas," he said, explaining he had prepared it on March 23, but had delayed handing it over because the Palestinian leader had been abroad.
But another Palestinian official, who also requested anonymity, said it was not certain Fayyad's resignation would be accepted.
Longstanding tensions between Fayyad and Abbas peaked on March 2 when the Palestinian Authority finance minister, Nabil Qassis, announced he was standing down.
Abbas, who was abroad at the time, rejected the resignation but Fayyad agreed to it.
The crisis over the finance minister "was the reason for Fayyad's resignation," al-Ahmad said.
"Fayyad will have to decide today whether to keep Qassis in his post, or to resign as head of the government," he added.
Last week, the Fatah Revolutionary Council for the first time openly criticized Fayyad's government over its economic policy.
"The policies of the current Palestinian government are improvised and confused in many issues of finance and the economy," it said.
The criticism came as several high-ranking officials suggested Abbas might be about to dismiss Fayyad.
Fayyad held the finance portfolio as well as the premiership before Qassis's appointment in May 2012.
Abbas's Palestinian Authority is in serious financial crisis, partly as a result of non-disbursement of promised foreign funding, although the US Congress quietly unblocked $500 million in aid in March.