(Bloomberg) -- European Central Bank Governing Council member Pablo Hernandez de Cos said it’s too soon to discuss when to lower borrowing costs — even if they may now be high enough to return inflation to the 2% goal.

How long interest rates will have to stay sufficiently restrictive “is a very difficult question and can’t be answered in advance,” the Spanish central bank governor said in an interview with Boersen-Zeitung published Friday.

“It depends on whether or not inflation and growth develop in line with their projected paths,” he said. “But it is certainly too early to talk about rate cuts at the moment.”

ECB officials have offered different views on whether last week’s hike in the deposit rate to 4% was the last in the current tightening cycle. While Greece’s Yannis Stournaras said Thursday that the central bank’s next move will probably be a cut, Bundesbank President Joachim Nagel said it’s too early to tell if another increase is necessary.

“Looking at today’s information, we certainly can’t rule out cuts,” De Cos said. “But I don’t want to and can’t confirm them either. As I said, uncertainty is still very high.”

He stressed that officials will remain data-dependent in plotting their next moves. 

“There could be further shocks,” he said. “Our response to them will depend on their origin and scale and on their impact on the inflation outlook.” 

The Spanish official also said: 

  • “We should be very cautious” when it comes to reducing the ECB’s balance sheet
  • Active sales of bonds are “not something we’re currently considering or will consider in the future”
  • On another potential increase in banks’ minimum reserves: “Further action on this front doesn’t seem obvious to me. In any event, the ongoing review of our operational framework will have to look into this more deeply”
  • “Risks to inflation are now balanced. In my view, developments since June have strengthened our confidence that the inflation path will move toward 2% by 2025”
    • “The growth outlook has been revised downwards and the risks are on the downside”
  • “Underlying inflation is now easing, so we seem to have finally turned the corner”
  • “Despite the current high level of uncertainty, GDP and inflation forecast errors have decreased very significantly”

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