Castro's comments at the end of the letter read out on a daily television current affairs programme suggested he would not resume office but instead take on the role of elder statesman advising the country's communist government on key issues.
Lucia Newman, Al Jazeera's Latin American editor, said Castro's announcement in recent weeks that he would stand for National Assembly elections next month had surprised many.
But his letter indicated that he had made a U-turn and it was being read in Cuba and elsewhere that he would now not stand for elections, meaning he will not be able to hold on to his post as president.
Castro holds the posts of president of the Council of State and Council of Ministers, and first secretary of the ruling Communist party.
Cuba's National Assembly could formalise Castro's retirement as head of state when it approves the members of the executive Council of State in March.
Castro, who took power in a 1959 revolution, temporarily handed over power to his brother, Raul, in July 2006 after undergoing stomach surgery.
But his reference to "younger people" seems to rule out Raul, who is only five years younger, stepping into his shoes permanently, Newman said, adding that it was not yet clear who would take their place.
There has been much talk about Castro's health and his latest announcement will certainly fuel even more speculation, Newman said.
But the 81-year-old leader also indicated that he was not about to simply fade from the scene, noting the example of famed Brazilian architect Oscar Niemeyer who is still working and to whom Castro paid homage with an essay to mark his 100th birthday on Saturday.
"I think like Niemeyer that you have to be of consequence up to the end," Castro said.