European Central Bank (ECB) Governing Council member Peter Kazimir signaled that they would avoid early interest rate cuts to prevent hindering the disinflation process, stating that June might be more appropriate than April for the first cut.
Regarding the matter, Kazimir stated, "It would be risky to act based on short-term surprises before the inflation outlook gains more clarity in the medium term. We could deal a blow to the progress made on the path to our target."
The ECB kept interest rates unchanged last week, marking the third consecutive meeting without a change. President Christine Lagarde had pushed back against aggressive market expectations for rate cuts.
"THE NEXT MOVE WILL BE A CUT"
Kazimir said, "The next move will be a cut. I am convinced that the precise timing—whether it is April or June—is of secondary importance in terms of the impact of the decision. The latter seems more likely, but I will not jump to any early conclusions regarding the timing."
Another Governing Council member, Mario Centeno, advocated for earlier and smaller-step cuts in a statement to Reuters.
Pointing out that there is evidence that inflation is falling in a sustainable manner, the official said, "There is no need to wait until May to have an idea about the inflation path."
News Source: 12punto
