Bush keeps 'open mind' on Argentina

Workers have protested against plans for big pay cuts

Talks between Argentina, the International Monetary Fund (IMF) and the US Treasury continued on Monday, as the country sought extra money to help ease its financial crisis.

United States President George W Bush said on Monday the US government was keeping an "open mind on all options" for Argentina.

President Bush called on Argentina to press ahead with its current reforms.

"We're watching the situation very carefully...We urge Argentina to implement (the) reforms. As they do so, they will gain the confidence not only of our country but of a lot of folks who are concerned about it," he said.

The IMF has already said it will speed up the disbursement of a previously announced $1.2bn loan, but Argentina is also seeking between $6bn and $9bn to strengthen its foreign currency reserves.

Protests continue

Earlier this month Argentina's government forced through a series of spending cuts which led to demonstrations across the country.

On Monday there was further action against the austerity measures with strikes in protest against public sector pay cuts.

The spending cuts are seen as necessary to balance the budget and avoid defaulting on the country's $128bn (£90bn) debt.

The collapse in confidence in Argentina's financial situation has led to many people withdrawing their savings. Bank deposits in the country fell by 7% in July.

Talks continue

Financial markets in Argentina were weaker on Monday as no firm news emerged from Washington about how the talks were progressing.

The head of the IMF, Horst Koehler, has already said he would recommend an early release of $1.2bn (£840m) to Argentina, which was due to be handed over in September.

Argentina's finance secretary, Daniel Marx is now trying to negotiate an extra $6-9bn in new aid, and talks with the IMF and US Treasury which were supposed to end on Sunday are still ongoing.

Argentina's government has already warned that it may take "several weeks" to negotiate a deal.