Malaysian Prime Minister Mahathir Mohamad at a press conference in Putrajaya, near Kuala Lumpur, on April 15, 2019.

Malaysia's Prime Minister Mahathir Mohamad has submitted his resignation to the king, according to the prime minister's office.

The resignation was submitted to the king at 1 p.m. local time on Monday, the statement by the prime minister's office said. It's unclear whether the Malaysian king will accept Mahathir's resignation and what will happen to the ruling coalition that he led, Pakatan Harapan.

In another surprise move, the 94-year-old also resigned as chairman of his own political party, Parti Pribumi Bersatu Malaysia.

Mahathir's decision to resign followed a weekend filled with speculation that the ruling coalition could lose power. Multiple local media, mostly citing unnamed sources, reported that Mahathir would shift allegiance by tying up with the opposition parties to form and lead a new government.

Following news of the political upheaval, the FTSE Bursa Malaysia KLCI Index extended its losses to close 2.69% lower on Monday, while the U.S. dollar strengthened by 0.84% against the Malaysian ringgit.

The country's central bank, Bank Negara Malaysia or BNM, said it was "closely monitoring conditions in the financial markets" after the latest political developments.

"While ringgit movements will continue to be market determined, BNM's market operations will ensure sufficient liquidity and orderly financial market conditions," it said in a statement.