Update: As expected, there is a "but" ... From the WSJ:
But the new declaration preserves next Saturday as the date of a referendum on a divisive proposed constitution, skirting a key demand of Mr. Morsi's opponents.
Selim Al Awa, a former presidential candidate and one of the lead negotiators between Mr. Morsi and his opponents, announced the new declaration in a news conference just past midnight on Sunday morning.
It still seemed unlikely that Mr. Morsi's partial climbdown would satisfy liberal-leaning politicians.
Their opposition to Mr. Morsi and his Nov. 22 declaration set off the worst constitutional crisis to afflict Egyptian politics in decades.
But it may ease tensions on the restive streets of Egypt's capital, where fighting between secularists and Islamists killed six people in the past week.
Mr. Morsi's new declaration maintains the accelerated timeline for adopting Egypt's new constitution, defying his opponents' complaints that Saturday's referendum would railroad through an Islamist-tinged constitution.
The concession marks only a mild sacrifice for Mr. Morsi, say the president's mostly liberal critics, because the power-expanding decree had already prevented Egypt's Supreme Constitutional Court from dissolving the constitutional drafting committee.
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While this still has to be confirmed by official Egyptian sources, both Al Jazeera and Al Arabiya are reporting that in what may be a first time in history, a "temporary" dictator - Egypt's Mohamed Morsi - has decided to end his temporary status and become one of the ordinary people again, having rescinded the much maligned decree giving him sweeping powers that brought the country to the edge of civil war and martial law less than two years after the Arab Spring removed Hosni Mubarak from decades of Egyptian rule.
Egyptian President Mohamed Morsi on Saturday annulled a decree he issued last month expanding his powers, an official told a Cairo news conference.
"The constitutional decree is annulled from this moment," said Selim al-Awa, an Islamist politician acting as spokesman of a meeting Morsi held earlier with other political leaders.
A referendum on a draft constitution would however still go ahead as planned on December 15, Awa said, explaining that constitutionally Morsi was unable to change the date.
The two issues -- the decree and the referendum -- were at the heart of anti-Morsi protests that have rocked Egypt in the past two weeks.
The controversial decree issued November 22 had put Morsi's decisions beyond judicial review -- a high-handed measure fiercely denounced as dictatorial by the opposition.
Opposition leaders demanded it be rescinded and the referendum be scrapped before they entered into any dialogue with Morsi to calm a crisis which exploded into street clashes this week that left seven people dead and hundreds injured.
Egypt's powerful military on Saturday warned Morsi and the opposition to sit down for talks, otherwise it would take steps to prevent a "disastrous" degradation of the situation.
Of course, we wouldn't be surprised if this update is promptly reversed shortly with yet another decree the rescinds the rescission, or is found to have been merely speculative and hopeful hearsay.