Value of Argentine peso falls 39 percent in first day of free float

The value of the Argentine peso fell by more than 39% in its first day as a free-floating currency.

It came after the decade-long link with the US dollar was ended.

President Eduardo Duhalde set the peso free as part of a two-tiered exchange rate the government hopes will ease the country's bitter recession.

Banks reopened their hard currency tills after a night of violence and protests over a banking freeze that limits access to deposits.

In the capital, what began as a peaceful pot-banging protest ended with enraged Argentines smashing bank windows and cash-withdrawal machines. There were no reports of injuries.

In the first serious test of Duhalde's economic plan, the peso's value sagged but did not plunge as some had feared.

Meanwhile, there was little sign from the International Monetary Fund that more support was on the way. The IMF withheld a $1.23b (€1.37bn) loan last month after officials decided the country did not have a sustainable economic program.

IMF Deputy Managing Director Anne Krueger said the agency does not believe the dual exchange rate system is sustainable.