‘IMF urges Government to adhere to adjustment of €3.1bn’

The International Monetary Fund has urged the Irish government to stick to its austerity plan and continue to cut €3.1bn from its forthcoming budget, despite new economic conditions meaning it could cut less and still achieve its budget deficit targets, writes The Irish Times.

Ireland aimed to reduce its expenditure by €3.1bn in order to achieve its deficit target of 5.1 per cent of GDP, however debt repayment deals renegotiated earlier this year have eased the pressure on the economy, meaning this level of spending cut would now reduce its budget deficit to 4.5 per cent.

Meanwhile, the government also wants access to an EU-IMF “precautionary credit” fund, which it believes would reassure investors of its financial stability ahead of its scheduled exit from the bailout programme and full return to the bonds markets in December.