The European Union's executive commission heaped praise Wednesday on efforts by Greece to bring down its public deficit to within EU limits, letting Athens off the hook for possible disciplinary action.

"The Greek government must be praised not only for implementing the 2005 budget with rigour but also for announcing additional measures for this year," EU economic affairs commissioner Joaquin Almunia said in a statement.

The European Commission, which is responsible for policing deficits in the eurozone, said Greece was taking "effective action" to shrink its shortfall below an EU limit of three percent of gross domestic product.

Under spending plans submitted to the European Union, the Greek deficit is forecast to fall from a peak of 6.1 percent of GDP in 2004 to 3.7 percent this year and 2.9 percent in 2006.

"Taking into account the existing risks, I welcome (Greece's) commitment to present a budget for 2006 in which the deficit would be brought below three percent of GDP," said Almunia.

Greece had been under pressure from the European Commission to reduce the deficit after having seriously understated past shortfalls.

Athens faced possible disciplinary action if it had not taken action.