Argentina has devalued the peso by nearly 30 per cent against the US dollar in a desperate bid to reverse a recession in its fourth year and broker social peace.
Just five days after President Mr Eduardo Duhalde took office, the populist Peronist party secured special powers from Congress to make the shift that will affect every facet of Latin America's third-largest economy.
The emergency economic plan - which comes after a month of cash shortages, rioting and looting that killed 27 and forced the resignation of two presidents - includes measures to soften the blow of the devaluation for individuals.
In a country where 80 per cent of loans are in dollars but wages are in pesos, the government will order a conversion of dollar debts up to $100,000 into pesos at one-to-one to avoid widespread bankruptcies.
To compensate for the losses to an already weakened banking sector, the government will give banks bonds backed by fuel exports.
Public utilities, including telephone, electricity and water companies, will also suffer as the government switches dollar tariffs into pesos to protect consumers.
Foreign banks and utility companies - mainly Spanish and US giants that moved into Argentina through the purchase of state assets in the 1990s - may be big losers.
To avoid a return to the exchange paranoia of the 1980s and an accumulation of dollars, the government will keep liquidity tight by maintaining restrictions on cash withdrawals. A ban on foreign exchange operations will remain in place until Wednesday.
But analysts abroad were sceptical at what some saw as a return to the days of heavy-handed state intervention.
"Instead of implementing transparent, market-friendly policies that might bring about a favourable response from the IMF and other official creditors, this Argentine government appears to be embarking on the kind of inward looking, interventionist policies that have failed in the past," said Mr Matt Ryan of Boston-based MFS Investment Management, which does not hold Argentine debt.