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Argentina relaxes controls on hard currency after sharp drop in peso

Argentina's government is relaxing restrictions on the purchase of U.S. dollars following a sharp, two-day slide in the value of the local peso.

Cabinet Chief Jorge Capitanich announced Friday that Argentines will be able to buy dollars for personal savings. He also says the tax collected at the time of the exchange will fall to 20 percent from 35.

He says purchases still must be in line with the income a person has declared to tax authorities.

The government had been steadily imposing tighter restrictions on dollars as its foreign exchange reserves slipped to the lowest level in seven years.

But the official peso rate slipped 16 percent between Tuesday's open and Thursday's close, finishing at 8 per dollar.