It is part of President Javier Milei’s “economic shock therapy” to help the country recover from its worst crisis in decades.

Economy Minister Luis Caputo also announced significant cuts in government spending.

Fuel and transportation subsidies will be reduced, while spending on key government contracts and advertising will be frozen.

Mr Caputo stated that he inherited Argentina’s worst economic legacy and that he was taking steps to avoid hyperinflation.

“We’ll be worse off than before for a few months, especially in terms of inflation.” And I say it because, as the president has stated, it is better to convey an uncomfortable truth than a comfortable falsehood,” Mr Caputo said in a broadcast speech.

Argentina is dealing with skyrocketing inflation, with prices increasing by about 150% in the last year. It also has poor financial reserves and a huge government debt, while 40% of the population lives below the poverty line.

The International Monetary Fund (IMF), to which Argentina owes $44 billion (£35 billion), described the measures as “bold” and stated that they will assist establish an atmosphere conducive to private sector growth.

“I welcome the decisive measures,” said IMF Managing Director Kristalina Georgieva, adding that it is “an important step toward restoring stability and rebuilding the country’s economic potential.”