BUENOS AIRES - The Argentine government in January saw its first monthly budget surplus in nearly 12 years, as new President Javier Milei continues to push for strong spending cuts, the Economy Ministry announced.

January was the first full month in office for Mr Milei, a far-right libertarian who took office in December, and it ended with a positive balance for public-sector finances of US$589 million (S$800 million) at the official exchange rate, the government said late on Feb 16.

The figure includes payment of interest on the public debt.

It is “the first (monthly) financial surplus since August 2012, and the first surplus for a January since 2011,” the Economy Ministry said, according to the official Telam news agency.

Mr Milei has been negotiating with the International Monetary Fund over its US$44 billion loan and has vowed to achieve balance in public finances in 2024.

“The zero deficit is not negotiable,” Economy Minister Luis Caputo said on Feb 16 on X, formerly Twitter.

Mr Milei, an economist, has advocated sharp cuts in spending and a reduction of public debt on the way to a dollarisation of the economy.

Following a 50 per cent devaluation of the peso, a lifting of price controls and strong rate increases, Argentina saw an inflation rate for January of 20.6 per cent, with a 12-month rate of 254.2 per cent.

The year 2023, the final year of the centre-left government of Mr Alberto Fernandez, ended with a 211 per cent inflation rate.

With poverty affecting 45 per cent of the population, Mr Milei has predicted an economic rebound within three months. AFP