Irish services sector posts strong growth at start of 2014 - PMI

DUBLIN (Reuters) - Ireland's services sector began the year on a solid footing with strong exports keeping its growth rate near a seven-year high recorded in December, a survey showed on Wednesday.

Having successfully exited an international bailout programme, Ireland now wants to make sure its economy can grow by the 2-3 percent needed to drive its high level of debt down after two years of near stagnation.

The Investec Purchasing Managers' Index of activity in the services sector, which covers businesses from banks to hotels and accounts for 70 percent of economic output, came in at 61.5 in January, far above the 50 line that divides expansions in activity from contractions.

It was the sector's 18th straight month of growth and was only a touch lower than December's 61.8 - the highest reading since February 2007.

It was also far above the euro zone average of 54.0, itself the strongest month the 18-member bloc has posted since mid-2011.

"With order books and payrolls on the rise and the expectations component standing at its joint-highest level since October 2006, it is clear that the outlook for the services sector in Ireland remains very encouraging indeed," said Investec Ireland chief economist Philip O'Sullivan.

In one encouraging sign, the subindex for new export business among firms rose to 64.9 from 62.6, the 30th straight month of growth and the highest since this subindex began.

Ireland's usually robust export sector has been struggling due to the mixed picture in Europe and the expiry of patents among the large cluster of drugs companies located in the country. But the government expects exports to rebound this year and grow by 1.9 percent.

(Reporting by Padraic Halpin; Editing by Hugh Lawson)