CARACAS -- Venezuela has put its planned withdrawal from the IMF on hold, saying Wednesday a government committee was weighing the consequences, which include a possible technical default on its sovereign bonds.

President Hugo Chavez announced in April he wanted to leave the International Monetary Fund immediately, complaining that the Washington-based lender's policies failed to help the poor in Latin America.

He was seemingly unaware that the move could trigger a massive default on the South American country's debt.

The April announcement pushed Venezuela's debt prices lower.

Story Continues Below

With the government taking no action since, investors have increasingly dismissed the concern that Chavez would follow through on his pledge.

On Wednesday, he appeared to have found a face-saving compromise.

"We will keep going in that direction," Chavez told a news conference when asked about pulling out of the IMF.

"We do not have to do so immediately for technical reasons but, as you know, it could affect some things ... the economy and Venezuelan debt, the debt others hold in Venezuela."

"Right now, in practical terms, we have nothing to do with the IMF or the World Bank."

In the past year, the leftist president has been issuing billions of dollars of international bonds, assuring investors that the OPEC nation's oil income would guarantee payments.

Venezuela's debt issues often include a clause stating that the country is in technical default should it cease to be a member of the IMF, which only four countries have left in its six-decade history.

© Reuters 2007. All rights reserved. Republication or redistribution of Reuters content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Reuters.

Editor's note:
The Nine Best Energy and Precious Metals Stocks
Cash in on dollar slide. Make 25 to 50% in six months.
The 3 Best Income Stocks in the World