Summer's departure at this juncture is expected to severely affect the functioning of the economic team that has been facing flak over the management of the recovery.
Administrative officials, however, quickly jumped to action to minimise the shock effect by dubbing the adviser's departure as an expected development.
Thanking Summers for his contribution to America in a statement, Barack Obama on Tuesday, Sep 21, said, “While we have much work ahead to repair the damage done by the recession, we are on a better path thanks in no small measure to Larry"s wise counsel."
Following budget director Peter Orszag and Christina Romer, head of the Council of Economic Advisers, Mr Summers becomes the third high-level member of Obama"s economic team to leave in the recent past.
Now, Obama's economic team just has treasury secretary Timothy Geithner as a top tier adviser.
Speculations suggest that Obama will take this opportunity to thwart the charge that his economic team is anti-business by replacing Mr Summers with a corporate executive.