Buenos Aires: Argentine President Cristina Fernandez de Kirchner fired Central Bank President Martin Redrado, saying that the move would allow the government to tap $6.6 billion (Dh24.27 billion) in reserves to pay debt due this year.
Central Bank Vice-President Miguel Pesce will take over as interim president, Fernandez said Thursday night. Mario Blejer, who served as bank president for five months during the country's financial crisis in 2002, will take up the post after he returns from Eur-ope, Economy Minister Amado Boudou said.
Fernandez and her cabinet signed a decree Thursday dismissing Redrado for "misconduct" and dereliction of duty after failing to force his resignation on January 6. Opposition lawmakers said they will hold an emergency session of Congress to denounce the move.
"This was a completely unexpected development," Alberto Bernal, an economist with Bulltick Capital Markets in Miami, said in an interview. "If they appropriate those reserves there will be a huge fight between the government and congress."
A central bank spokesman didn't respond to a message left on his mobile telephone by Bloomberg News. Blejer didn't respond to a message left at his home in Buenos Aires.
Government benchmark Boden notes slid the most since late November on Thursday, dropping 3.35 cents on the dollar. The extra yield investors demand to own Argentine bonds rather than US Treasuries jumped 13 basis points, or 0.13 percentage point, to a two-week high of 6.69 percentage points.
