MEXICO CITY (Reuters) - Argentina's economy ministry said on Sunday it will purchase just over $1.5 billion from the central bank to pay the total interest on the country's "Globales" and "Bonares" bonds due in January 2025.
The operation will use part of the financial surplus achieved in the first half of the year, which had accumulated to 2.3 trillion Argentine pesos ($2.5 billion) by May, the ministry said in a statement.
The ministry added that $1.528 billion will be deposited in an account at trustee Bank of New York and will be available only to be used for paying the interest on the bonds.
The announcement came a day after the government of libertarian President Javier Milei outlined a plan to stop expanding the monetary base in order to combat annual inflation close to 300%.
Milei, a free-market economist, has embarked on an at-times painful austerity drive since taking office, cutting state spending and pledging to rebuild the country's depleted foreign exchange reserves.
The central bank went on an aggressive buying spree of dollars in the first months of Milei's government. It needs dollars to pay creditors.
The bank's reserve accumulation is key to restoring economic and financial stability after years of crisis, and pivotal to the government being able to follow through with its pledge to undo tough currency controls that stymie business and trade.
($1 = 919.0000 Argentine pesos)