Novel femtosecond, multiple pulse experiments including polarization control are performed to elucidate the dynamics of fragment recoil in the 400-nm photolysis of triiodide ions in liquid ethanol solution. The instantaneous resonance Raman response of the dynamic system, induced at well defined delays after impulsive bond fission of the parent ion, displays a time-dependent vibrational frequency of the diatomic fragment. This time dependence is interpreted through interactions between the fragments which decay with increasing interfragment separation. Simultaneously, the instantaneous anisotropic response of the reactive system exhibits electronically coherent contributions at very early times after bond breakage and provides direct evidence for the existence of electronic degeneracies in the vicinity of the Franck-Condon region. The decay of this coherent anisotropic component reflects a dynamic lifting of these electronic degeneracies upon recoil of the product species and decay of residual interactions between the fragments. From both experiments it can be concluded that in liquid solution it takes about 2 ps until the fragments arrive in the asymptotic limit of the reaction with negligible product interactions.