Israel appears to have backed down over its plans to appoint a former settler leader as its ambassador to Brazil.

Prime Minister Benjamin Netanyahu announced the nomination of Dani Dayan last August, prompting protests from the Brazilian government who objected to his past role as chairman of the Yesha committee representing Israeli settlements in the West Bank.

A seven-month stand-off followed, with Mr Netanyahu insisting that Mr Dayan was the right man for the job.

But now, the Prime Minister’s office has announced Mr Dayan’s appointment as consul general in New York.

Mr Dayan reportedly denied that the Israel had been forced to climb down in the face of disapproval from Brazilian president Dilma Rousseff.

“I don’t think that we folded,” he said. “There was no choice. Those who don’t want me in Brasília will get me in the capital of the world and to me that is a victory.”

In a statement reported in the Israeli media, Mr Dayan said he would “conduct comprehensive and respectful dialogue with all segments of American Jewry — Orthodox and Reform, liberals and conservatives, and with supporters of both parties [Republican and Democratic], all while representing the positions of the State of Israel faithfully and devotedly.”

And in an interview on Israel’s army radio, he revealed that he had asked Mr Netanyahu to send him to New York instead of Brasilia.

Deputy Foreign Minister Tzipi Hotovely welcomed the appointment, stating that it sent “an important statement to the world”.

“The State of Israel will benefit from a worthy representative who lives in the settlements of Judea and Samaria and will bear an important message to the effect that the State of Israel stands behind Dani as a loyal and worthy representative of the state,” she said.