The Cathedral issued a statement today that said it had “unanimously” agreed to suspend legal action that would have called for the eviction of demonstrators.

The statement added that the resignation of the former dean, Rt Rev Graeme Knowles, had enabled the cathedral’s chapter an “opportunity to reassess the situation”.

The Cathedral now appears to be seeking to help the demonstrators with their cause.

The statement went on: “Members of Chapter this morning have met with representatives from the protest camp to demonstrate that St Paul’s intends to engage directly and constructively with both the protesters and the moral and ethical issues they wish to address, without the threat of forcible eviction hanging over both the camp and the church.”

St Paul’s revealed it has appointed an investment banker, former UBS Europe and Lazard International employee Ken Costa, to lead an initiative that would involve various church and City figures to reconnect “the financial with the ethical”.

The Bishop of London, Dr Richard Chartres, said: “The alarm bells are ringing all over the world. St Paul’s has now heard that call. Today’s decision means that the doors are most emphatically open to engage with matters concerning not only those encamped around the Cathedral but millions of others in this country and around the globe.”

However, the church also acknowledged that the City of London Corporation –  the local authority for the Square Mile – still has the right to take legal action on its land.

The Telegraph newspaper reports that the corporation will likely serve notice on the protestors, giving them 48 hours to clear more than 200 tents from the site.