Ireland may beat its target of reducing the deficit to 10.6 per cent of gross domestic product this year, according to Minister for Finance Michael Noonan and Central Bank governor Patrick Honohan.

"We are on track to observe, and indeed overachieve, the programme target on the overall deficit for 2011 as a whole of 10.6 per cent of GDP," the two said in a letter to the country's bailout partners, dated July 28th and published
on the Department of Finance website today.

The Government has met and "in some important cases exceeded" its commitments under the aid program with the European Union and International Monetary Fund, according to the letter.

Ireland has requested its third installment of €5.5 billion from the European Union as part of its aid.

The Government said today it will set out by the end of October a medium-term fiscal consolidation plan for 2012 to 2015 "outlining the overall composition of revenue and expenditure adjustments for each year".

Bloomberg