Irish budget deficit fell to 4.1 pct at end-2014

DUBLIN, April 20 (Reuters) - Ireland (Other OTC: IRLD - news) 's budget deficit fell to 4.1 percent of gross domestic product at the end of 2014, well under a European Union-set target of 5.1 percent as it moves towards cutting it below 3 percent by the end of this year.

The deficit fell from 5.8 percent at the end of 2013 thanks to the final measures of a seven-year austerity drive and rapid economic growth, which at almost 5 percent last year was the fastest rate across the European Union.

The fast recovering economy has also helped cut Ireland's public debt which the Central Statistics Office (CSO) said fell to 109.7 percent of GDP at the end of 2014 from 114.3 percent the previous quarter, mainly due to the early repayment of some of Dublin's bailout loans.

Ireland, whose deficit represented more than 13 percent of annual economic output at the height of its financial crisis four years ago, had forecast a reduction to 3.7 percent last year before a jump in year-end government spending.

However the government is confident that it can rely solely on economic growth while unwinding some tax hikes and spending cuts to meet its foreacst of trimming the deficit to 2.7 percent this year before eliminating it in line with EU rules by 2018.

(Reporting by Padraic Halpin; editing by Ralph Boulton)