November 26, 2018 / 6:43 PM / 23 days ago

IMF approves second review of Argentina, paves way for $7.6 billion in funds

FILE PHOTO: The International Monetary Fund (IMF) logo is seen outside the headquarters building in Washington, U.S., as IMF Managing Director Christine Lagarde meets with Argentine Treasury Minister Nicolas Dujovne September 4, 2018. REUTERS/Yuri Gripas/File Photo

BUENOS AIRES (Reuters) - The International Monetary Fund has completed its second review of Argentina, the fund said on Monday, paving the way for the country to receive $7.6 billion under a $56.3 billion financing deal.

The next disbursement will be made once the IMF executive board approves the staff-level inspection of Argentina’s fiscal and monetary policy required under the agreement announced in June, the fund said in a statement.

IMF officials conducted the review in Buenos Aires from Nov. 9 to 16, and met with Economy Minister Nicolas Dujovne and Central Bank Governor Guido Sandleris, the statement said.

Argentina renegotiated the deal, the fund’s largest ever, in September after the peso lost half its value against the greenback in 2018, sparking investor fears over the country’s ability to service its international debts in 2019.

In line with the agreement, Argentina’s Congress passed an austere 2019 budget earlier this month to balance the country’s fiscal deficit next year.

“Strong implementation of the government’s plan is essential to pave the way for a rebound of economic activity in 2019 and to support job creation, reduce poverty, and improve the living standards of all Argentines,” the statement said.

Under the IMF deal, Argentina’s central bank established a floating exchange rate band for the peso to stabilize foreign exchange markets and has sought control of the country’s money supply to rein in inflation.

IMF Executive Director Christine Lagarde is expected to travel to Buenos Aires this week to participate in the Group of 20 summit, hosted by Argentina this year.

Reporting by Scott Squires; Editing by Richard Chang

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