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Argentine leader sacks bank boss Argentine bank chief steps down
(about 1 hour 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. Argentina's central bank boss has stepped down after the president signed a decree firing him for refusing 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. A spokesman for Mr Redrado said he had agreed to step aside but not to resign, and was launching a legal challenge.
Constitutional lawyers say the decree may be illegal, as the central bank chief can only be removed by Congress.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. Mr Redrado angered the president after he rejected her order to transfer $6.6bn to a government fund to pay foreign debts.
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.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.
RecessRecess
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.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 ArgentinaThe 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. But 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 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.