The International Monetary Fund's Executive Board approved a disbursement of approximately $138-140 million to El Salvador on October 1, 2026, under its $1.4 billion Extended Fund Facility, and granted a waiver for the country's breach of a program condition tied to Bitcoin accumulation.

The board's decision followed a staff-level agreement on the combined second and third reviews of the EFF, which was established in February 2025. The disbursement is intended to support ongoing fiscal and structural reforms.

The waiver resolves a sensitive point in the lending relationship. El Salvador failed to meet a performance criterion connected to its Bitcoin purchases — a condition written into the loan agreement to cap the government's exposure to the asset. The IMF chose to forgive the miss rather than suspend the program, keeping the funding pipeline open while leaving the underlying constraint in place for future reviews.

The fund's economic assessment accompanying the reviews was broadly positive. The IMF projects real GDP growth of 4.5% for 2026, after the economy expanded 3.9% in 2025 — a result the fund said exceeded expectations. In the second quarter of 2026, output grew 5.1% year-over-year, reaching $10,060.6 million. Construction activity rose 11.2% in the quarter, with gains spread across multiple sectors.

The IMF attributed the expansion to strong investment levels, rising private consumption, large remittance inflows, a recovery in tourism, and sizable capital inflows. It also credited the government's macroeconomic policy choices, which it said have strengthened the fiscal position and built up external buffers.

The program carries specific fiscal targets that will frame the next phases of the arrangement. El Salvador is expected to reach a primary surplus of 3.7% of GDP by 2027 and reduce public debt to 80% of GDP by 2030. The disbursement structure gives the fund continued leverage over fiscal policy through the semi-annual review cycle.

The IMF also linked part of the improved outlook to security gains, which it said are reflected in rising investor confidence. The homicide rate fell from approximately 54 per 100,000 people in 2018 to around 1.8 in 2024 — a shift the fund treated as an economic variable, underpinning capital inflows and tourism rather than standing apart from them.

For El Salvador's Bitcoin policy, the waiver marks a pragmatic settlement rather than a resolution. The Bukele government can continue accumulating the asset, but each subsequent EFF review will test whether the purchases stay within agreed bounds. A further breach could force the fund to choose again between enforcement and forbearance, and the next review will show whether the waiver was a one-off accommodation or the start of a recurring negotiation over the fiscal treatment of the country's Bitcoin holdings.