(Bloomberg) -- The European Central Bank may lift interest rates early in the third quarter if it decides to end bond purchases at the end of June, according to Governing Council member Joachim Nagel. 

“It seems that we’ll be able to conclude net purchases, possibly already at the end of the second quarter,” Nagel told journalists in Washington, where participates in the spring meetings by the World Bank and the International Monetary Fund. A first interest-rate increase could then happen “at the beginning of the third quarter, if you stick to the sequence that we agreed on.” 

He added that such a scenario would be in line with expectations from investors, who’re betting that the ECB’s deposit rate -- currently at a record-low -0.5% -- will increase to zero this year to contain record inflation rates. The frequency of rate hikes in the second half of the year will depend on economic data, Nagel said. 

His Latvian colleague in the Governing Council, Martins Kazaks, said in an interview Wednesday that a rate increase in July is possible and that the ECB is on “a solid path of policy normalization.” The central bank is expected to taker further decisions at its June meeting, where new economic forecasts will give an updated view on how inflation and growth will be impacted from the war in Ukraine. 

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