Anti-government protests have continued regardless

Thousands of people had taken to the streets of the city in defiance of the new emergency powers.

They were also protesting about his decision to dismiss the Supreme Court.

The magistrates were appointed by the president's allies in Congress in December, sparking a wave of popular street protests.

Mr Gutierrez had blamed the unpopular judges for three days of anti-government street marches.

Speaking on national television on Saturday, Mr Gutierrez said he was lifting the emergency measures because he had "obtained the principal objective, which is the dismissal of the Supreme Court".

Little by little, tranquillity is returning to the nation President Lucio Gutierrez

"Little by little, tranquillity is returning to the nation," he said.

Congress had agreed to hold a special session to ratify his dismissal of the Supreme Court and debate a measure to depoliticise appointments, he added.

Opposition politicians have said the sacking of the judges is unlawful, and accuse Mr Gutierrez of being a dictator.

'Bias'

Up to 10,000 people have been protesting in the streets of Quito since Thursday, banging pans and demanding the president's resignation.

The unrest began in December, when Mr Gutierrez first fired the Supreme Court, alleging that the magistrates were biased against him.

Opposition groups accuse Gutierrez of behaving like a dictator

The crisis deepened in March, when the new court dropped corruption charges against ex-President Abdala Bucaram.

Mr Bucaram's Roldosista Party had backed Mr Gutierrez's drive to replace the Supreme Court. The party also helped to block an opposition attempt to impeach Mr Gutierrez in November.

Opponents say dismissing the judges was part of a government deal to exonerate Mr Bucaram in return for his political support.

But Mr Gutierrez said the old court had to go because its judges were biased in favour of opposition parties, particularly the Social Christians.