June is 'most probable' for first interest rate cut, ECB's Scicluna says

I mean one has to talk about the background. I mean you have a very weak economy and weak economic growth for the last six quarters. And you know, but what’s interesting is like we have a dual economy, it’s not just like one economy in Europe. You have the manufacturing which is weak, food prices are coming down and inflation is coming down accordingly and then a very resilient service sector. So those countries like Malta, Portugal and the Mediterranean countries are quite continuous quite strong activity because they have a very important tourism, you know service sector while in the north is the other way around. But All in all you know the economy is weak and all everything is pointing towards you know, declining disinflation, declining inflation all all over including wages, food, energy and so on. So it’s it’s more a question of how you, whether you risk averse and you always scared because of risks you know that you, you know you wait to cut and that was it. I mean one could have cut racing way back in March or even in April. So we hope that the majority of the members in the Governing council come June, they might unless, you know, they’re still, especially with what’s happening in the US, not that we we follow, you know, and it might have an effect. But I think June is the most probable where the majority would say yes, I think, you know, we have to start, you know, because we are, it’s restricting the economy, it’s restricting demand. And, you know, if there is no reason for it, if we are seeing that the inflation is coming to do our target of 2%, what’s why do you continue, continue holding the choker on the economy for nothing, You know, do you think the ECB is too concerned about what’s just transpired, the fact that a lot of central banks missed transitory inflation so are now concerned to show that they’re hawkish on inflation and are concerned about getting it wrong on the other side. No waiting. More waiting. More Are they waiting more than they would have done in the past. Yes. Could be, you know, I mean could well be that. No, it is, you know, they just want to be convinced. No, I I think it’s very, very subjective here. I mean, from my own experience, if you’re risk averse, how can I, you know, convince you that it’s all coming down and it will continue coming down. Others are like Saint Thomas. They want to see, you know, and wait. Now what is the, what is the risk of waiting then what is the risk that waiting till June or later? In my opinion, it just stays there, you know, I mean you’re you’re, as I said, choking the economy. If there’s a need for that, that’s fine. You know, I mean, like in the States, you know, there there is justification for waiting. But in our case, you know, it does a lot of damage. I mean the economy wants to grow and I mean we’re holding, I mean a lot of investment not being done, firms, you know, and so on. And if you wait wait, then the consequences will be higher.