baccaratcollection| ECB chief economist says interest rates may be cut next month but restrictive policies will remain this year

European Central Bank chief economist Philip Lane saidbaccaratcollectionThe European Central Bank is expected to start cutting interest rates next month, but needs to keep policies within restrictive limits in 2024.

"The best way to outline the topics of this year's debate is that we still need to remain restrictive throughout the year." "But in restricted areas, we can cut rates slightly," Lane said in an interview released Monday.

Asked about the prospects for action at the June 6 meeting, he said: "Barring a major surprise, at the moment we believe there is sufficient reason to lift the highest level of restrictions."

It is widely expected that the European Central Bank will start implementing monetary easing at its next meeting. Subsequent actions are less clear, with markets expecting policymakers to sit tight in July and then resume interest rate cuts in September. The pause will echo comments from hawkish officials Joachim Nagel and Isabel Schnabel, but most members of the management committee have remained silent on the topic.

"Next year, inflation is significantly closer to the target and then ensuring that interest rates fall to levels consistent with that target, that will be a different topic of discussion." Lane said.

The ECB's chief economist said the situation will be ups and downs and will be gradual.