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THE IMF has hinted that it could cut the interest rate on the €22.5bn lent to Ireland.

David Hawley, senior communications adviser with the IMF, outlined that changes at the IMF itself could see Ireland's rate negotiated by Ajai Chopra (below) falling.

The rate is currently at 3.1pc, and although the IMF was reluctant to comment on how much the rate would drop by, its understood the organisation is reviewing the system of quotas that make up the fund.

Ireland is one of the countries likely to see its quota rising, which would lower the interest rate.

The organisation is currently engaged in a major review of this system and Ireland is set to be a beneficiary.

Mr Hawley said that the rate was currently at 3.1pc and was based on special drawing rights, a form of internal currency used by the IMF.

In addition, its believed that the EU is also examining reducing the rate on its portion of the €85bn bailout package given to Ireland in December.

However, this could take several months and is meeting internal opposition in the EU.

Various European countries are providing Ireland with up to €45bn of funds, with Ireland itself chipping in €17.5bn for the bailout fund.

The IMF has asked Ireland to hit targets over the next few months or payments could be delayed.