(Bloomberg) -- European Central Bank Governing Council member Joachim Nagel joined a growing group of colleagues who are open to considering lowering interest rates this summer — suggesting the euro zone’s economic tides are starting to turn.

For the first time since borrowing costs reached their peak in September, Nagel — the influential Bundesbank president — conceded in a Bloomberg TV interview that summer may be an appropriate juncture to discuss whether growth and inflation have weakened sufficiently to ease policy. 

While insisting the topic is premature for now, falling into line with other Governing Council members indicates that a consensus is building inside the ECB.

But there are caveats: Nagel pointed to wages as “the great unknown,” while Austria’s Robert Holzmann, an arch-hawk, warned that cuts aren’t guaranteed at all in 2024 due to geopolitical risks including the tensions in the Middle East.

For the most part, though, policymakers appear to be preparing the ground for a shift. Portugal’s Mario Centeno has indicated the ECB could move in the next six months, while Greece’s Yannis Stournaras and Latvia’s Martins Kazaks have mentioned mid-year. 

Even those who’ve pushed back — such as Croatia’s Boris Vujcic and the Netherlands’ Klaas Knot — have only described a first-half cut as unlikely, rather than impossible.

Kicking off in the summer would bring the ECB closer to the outlook of economists, who anticipate a first of four cuts in June. That’s a much less aggressive view than that of traders, who are betting on six quarter-point steps starting in April.

“Members of the Governing Council from across the spectrum of hawks and doves appear to be increasing their efforts to push back against pricing in the financial markets,” said David Powell, senior European economist at Bloomberg Economics. “This reinforces our view that the first rate cut will come in June, and we expect President Christine Lagarde to convey a similar message at the press conference after the ECB’s meeting in January.”

Lagarde has said rate reductions will begin once policymakers are convinced inflation is headed back to the 2% goal — something Nagel embraced. Most say that means waiting for crucial data on wages that are only likely to come around May, making June the earliest meeting at which the deposit rate could be lowered from its current 4%. 

“Maybe we can wait for the summer break or whatever but I don’t want to speculate,” Nagel said, highlighting that officials will remain data-dependent. “I think it’s too early to talk about cuts.”

He also cautioned against easing too early.

“This was often a mistake that was done in the past; I don’t want to repeat this mistake,” the German official said. “Inflation is a greedy beast.”

Chief Economist Philip Lane made a similar point over the weekend, saying that lowering borrowing costs isn’t something the ECB will be discussing any time soon, and that recalibrating rates too quickly can be “self-defeating.”

Both Nagel and Holzmann singled out geopolitics as a key risk that could alter their views.

“The geopolitical threat has increased because what we saw until now by the Houthis — I think it’s not the end, it might be the overture to something much more broad based, which will impact the Suez Canal and increase the prices there,” Holzmann said in a separate Bloomberg interview. “We should not bank on the rate cut at all for 2024.”

Once the ECB sets a date for easing, he argued, it would immediately trigger a dynamic it can’t control.

“And with all the knowledge we currently have, it would not be honest to do it because we don’t know how inflation will develop,” Holzmann said.

Next week’s ECB policy gathering is likely to see borrowing costs stay on hold, with officials reluctant to declare victory over inflation.

Indeed, Vice President Luis de Guindos reckons the slowdown in consumer-price growth will be less pronounced this year. Inflation quickened to 2.9% from a year ago last month. A monthly gauge of consumer expectations is due Tuesday.

--With assistance from Alexander Weber and Francine Lacqua.

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