Ireland may choose to exit its bailout programme without the support of a precautionary credit line, the Minister for Finance said following a meeting with the IMF. However, no decision would be made until a new government has been formed in Germany.
“The option of not having a programme is still a strong option", Michael Noonan said following the meeting with the IMF’s top officials, including its deputy managing director, David Lipton, and head of its European division, Reza Moghadem. “It’s still an open question. It’s finely balanced... We’re funded into 2015 so we’re not taking a big risk to go it alone", he said.
He noted that Irish government bond yields had fallen since Taoiseach Enda Kenny’s speech to the Fine Gael party conference two weeks ago, which stressed that Ireland had €25 billion in reserve. “[Since that] our spreads have come in. We’re down at around 3.5, that’s down from nearly four over a period of a month, so the markets have a good perception of us at the moment.”
The Minister said that a decision on an exit strategy for Ireland would not be made until a new government is formed in Germany. “It’s not really possible to make a decision while there’s no government in Germany... I understand the SPD [Social Democrats] are having their conference around November 15th. There can’t be a commitment before that, so I suppose [a decision will be made] between that and the end of November", Mr Noonan said.
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