WASHINGTON, July 25, 2025 (BSS/AFP) - The International Monetary Fund on Thursday announced a deal with the Argentine government as part of the first review of a $20 billion loan program, paving the way for a $2 billion disbursement.

This second loan tranche is still subject to approval by the IMF Executive Board, which is due to meet by the end of the month.

It would bring the total amount available to Argentina under the program announced in April to around $14 billion.

"The program has had a strong start, underpinned by the continued implementation of tight macroeconomic policies, including a strong fiscal anchor and a tight monetary stance," the IMF said in a statement.

It highlighted an exchange rate managed at expected levels and an easing of inflation, which reached 39.4 percent year-on-year at the end of June, compared with 117.8 percent at the end of 2024.

The IMF noted continuing economic growth and a decline in poverty rates, which had topped 50 percent at one point before falling back to 38.1 percent at the end of 2024, around the level before budget-slashing libertarian Javier Milei became president.

The Washington-based fund also cited Argentina's return to international financial markets after Moody's upgraded its rating earlier this month, from Caa3 to Caa1, although it remains in the speculative category.

The IMF loan was part of a $42 billion bailout that also included funding from the World Bank and the Inter-American Development Bank.

Milei was elected in December 2023 on the promise of reviving the South American country's crisis-hit economy, which achieved its first budget surplus in 14 years in 2024 thanks to austerity measures and sweeping public sector cuts.

Argentina, which has a track record of economic crises and hyperinflation, is the IMF's biggest debtor, ahead even of war-torn Ukraine.

It owes the IMF $44 billion under a 2018 loan agreement -- the lender's biggest ever -- on which it has since renegotiated the repayment terms.