Argentina’s government has unexpectedly asked for the early release of a $50bn (£37.2bn) loan from the IMF amid a growing economic crisis. President Mauricio Macri said the move was designed to restore confidence in the Argentine economy.

The Argentine peso has lost more than 40% of its value against the US dollar this year and inflation is rampant. The IMF confirmed on Wednesday it was looking to strengthen the arrangement and changing its phasing.

“I stressed my support for Argentina’s policy efforts and our readiness to assist the government in developing its revised policy plans,” Christine Lagarde, managing director of the International Monetary Fund (IMF), said in a statement.

Investors are concerned Argentina may not be able to repay its heavy government borrowing and could default. Correspondents say the decision to speed up the IMF bailout smacks of growing desperation.

When the terms of the loan were agreed in May, President Macri said he expected the economy to recover and did not plan to use the money.

“Over the last week we have seen new expressions of lack of confidence in the markets, specifically over our financing capacity in 2019,” Mr Macri said in a televised address. “We have agreed with the International Monetary Fund to advance all the necessary funds to guarantee compliance with the financial programme next year. “This decision aims to eliminate any uncertainty.” He added that further measures to rein in government borrowing would accompany the move.