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| Argentine leader sacks bank boss | Argentine leader sacks bank boss |
| (about 2 hours later) | |
| Argentina's president has ordered the removal from office of the head of its central bank, who had refused to use currency reserves to pay foreign debt. | |
| Cristina Fernandez de Kirchner cited misconduct and dereliction of duties in a decree dismissing Martin Redrado. | Cristina Fernandez de Kirchner cited misconduct and dereliction of duties in a decree dismissing Martin Redrado. |
| Reports said Mr Redrado had agreed to step down, but was launching a legal challenge to the president's decree. | |
| Constitutional lawyers say the decree may be illegal, as the central bank chief can only be removed by Congress. | |
| The president initially asked Mr Redrado to resign after he rejected her order to transfer $6.6bn to a government fund, but the banker refused to go. | |
| Argentina has $13bn of international debt that matures this year, and a hole in its budget of between $2bn and $7bn. | Argentina has $13bn of international debt that matures this year, and a hole in its budget of between $2bn and $7bn. |
| The BBC's Candace Piette, in Buenos Aires, says economic analysts believe the attempt to sack Mr Redrado shows how desperate Argentina's government is to get funds to pay debt - a bad sign for a country seeking more foreign investors. | |
| Recess | Recess |
| In the emergency decree, Mrs Fernandez de Kirchner said the central bank governor had "failed to fulfil the duties of a public servant" and urged prosecutors to seek unspecified "legal measures" against him. | |
| The decision was made because the central bank must keep functioning Cristina Fernandez de KirchnerPresident of Argentina | The decision was made because the central bank must keep functioning Cristina Fernandez de KirchnerPresident of Argentina |
| Later, she named Mr Redrado's deputy, Miguel Pesce, has his interim successor. Mr Pesce had supported the government's move to use reserves to cover debt. | Later, she named Mr Redrado's deputy, Miguel Pesce, has his interim successor. Mr Pesce had supported the government's move to use reserves to cover debt. |
| "The decision was made because the central bank must keep functioning," she said. | "The decision was made because the central bank must keep functioning," she said. |
| However, opposition politicians and constitutional experts said the president did not have the legal authority to dismiss Mr Redrado. | However, opposition politicians and constitutional experts said the president did not have the legal authority to dismiss Mr Redrado. |
| Under the bank's charter, the government can dismiss a member of its board, but must have a recommendation from a special congressional committee. | Under the bank's charter, the government can dismiss a member of its board, but must have a recommendation from a special congressional committee. |
| Economy Minister Amado Boudou said that since it was ultimately the president's decision and Congress was in recess, the direct dismissal was legal. | Economy Minister Amado Boudou said that since it was ultimately the president's decision and Congress was in recess, the direct dismissal was legal. |
| Although Mr Redrado has agreed to leave his office, "he will not resign" but will take his row with the president to court, news agency AFP quoted a spokesman for the central bank chief as saying. |