President Mauricio Macri asked for an early release of the loan worth $50 billion from the International Monetary Fund. IMF is concerned that the financial crisis in Argentina might cause failure to meet debt obligations in 2019.
The sell-off left the peso trading at around 39 to the dollar.
Efforts by the Argentinian central bank to stabilize the national currency by raising a key interest rate to 60 percent have done little to soothe rapidly deteriorating sentiment in Latin America's third-largest economy. Rising US interest rates also lured investors to pull their dollars out of Argentina. The central bank is targetting an annual inflation rate of 5% in 2022. It continues to be the worst-performing currency of 2018, falling 46.3% against the dollar since 1 January.
Argentina was forced to strike a deal with the International Monetary Fund earlier this year after a sharp depreciation of its currency and a run on the peso.
Receiving the financing will allow the government to bolster confidence and return to a growth path as quickly as possible, President Mauricio Macri said in a televised address.
Benchmark 10-year U.S. Treasury notes last rose 7/32 in price to yield 2.8568 percent, down from 2.882 percent late on Wednesday.
The development came amid heightened volatility in Argentina's financial and currency markets, which have been battered by uncertainty over inflation, an economic downturn and budget deficits.
The Argentine peso crashed to document lows on the guidelines.
Paul Greer, portfolio manager of the Fidelity Emerging Market Debt fund said the central bank's latest policy move, in addition to the IMF "engineering fiscal austerity" in Argentina, "it looks likely that the economy is heading for a hard landing recession over the next 12 months".
The "more adverse global market conditions" battering Argentina's economy "had not been fully anticipated", she admitted in a statement.
"I am confident that the strong commitment and determination of the Argentine authorities will be critical in steering Argentina through the current hard circumstances and will ultimately strengthen the economy for the benefit of all Argentines".
The country's opposition blames Mr Macri's centre-right policies, including the end of capital controls and cuts to social programmes, for the economic crisis. The most recent took place in 2001, when the economy unraveled and Argentina suffered a record $100 billion debt default.
As the BBC observes, "going to the International Monetary Fund is the most unpopular move a president could make in Argentina". "I understand this, and I resolve on you to know I'm making all decisions needed to guard you", Macri acknowledged.