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Mr Comey had initially declined to testify in front of the Senate Intelligence Committee in a closed-door hearing. The announcement comes the same day Mr Trump said he could name a new FBI Director as early as next week.
Mr Trump said the administration is looking at "outstanding people...very well known" and will come to a decision quickly.
He had fired Mr Comey for being a "showboat" and eroding public trust in the FBI but had praised him repeatedly during the 2016 campaign for coming forward about the investigation into then-opponent Hillary Clinton's use of a private server to send classified emails while she was Secretary of State.
He was "not doing a good job," Mr Trump said on his decision to fire Mr Comey, adding that the thinks "this Russia thing with Trump and Russia is a made-up story"
Mr Trump allegedly asked Mr Comey to "pledge loyalty" during a White House dinner, but the former FBI Director felt uncomfortable doing so. It may have also upset Mr Trump that Mr Comey testified in Congress that there was no evidence to Mr Trump's wild claim that President Obama had Trump Tower wiretapped during the 2016 election.
Mr Comey's farewell letter to the FBI seemed to indicate he felt the Russia investigation should continue. Just prior to being fired Mr Comey had requested more resources for it.
It is likely Mr Comey will be asked about the Russia probe and possibly Mr Trump's claim on Twitter that there were recordings of the pair's conversations, a comment which the president has refused to elaborate upon.
James Comey better hope that there are no "tapes" of our conversations before he starts leaking to the press!
— Donald J. Trump (@realDonaldTrump)
No date has been set as yet for Mr Comey's public testimony or any announcement of whether the Senate committee would be willing to hold the hearing publicly.