Angry protesters "entered the Republican Palace" shortly after Sadr said he was quitting politics, the source said, with several thousand other Sadr loyalists heading towards the Green Zone, an AFP journalist reported.

The army has announced a Baghdad-wide curfew to start from 3:30 pm (1230 GMT).

"A full curfew in the capital Baghdad affects all vehicles and citizens," the Joint Operations Command said in a statement.

Hours earlier, Sadr announced he was quitting politics, after a nearly year-long political stalemate that has left the country without a new government.

"I've decided not to meddle in political affairs. I therefore announce now my definitive retirement," said Sadr, a longtime player in the war-torn country's political scene, though he himself has never held a government post.

He made the announcement on Twitter, where he added that "all the institutions" linked to his Sadrist movement will be closed, except the mausoleum of his father, assassinated in 1999, and other heritage facilities.

His latest statement came two days after he said "all parties" including his own should give up government positions in order to help resolve the months-long political impasse.

Since legislative elections in October last year, political deadlock has left the country without a new government, prime minister or president, due to disagreement between factions over forming a coalition.

His bloc emerged from last year's election as the biggest, with 73 seats, but short of a majority. In June, his lawmakers quit in a bid to break the logjam, which led to a rival Shiite bloc, the pro-Iran Coordination Framework, becoming the largest in the legislature.

Since then, Sadr has engaged in other pressure tactics, including a mass prayer by tens of thousands of his followers on August 5.