ECB June rate cut looks increasingly likely — but there are 'still some caveats,' German central bank chief says

European Central Bank policymaker Joachim Nagel said Wednesday that a rate cut for the institution looks increasingly likely for June, but added that certain parts of the incoming inflation data still look higher than desired.

"Talking about the June meeting, I think the probability is increasing that we will see a rate cut in June but there are still some caveats," the chief of Germany's Bundesbank told CNBC's Karen Tso at the IMF Spring Meetings taking place in Washington, D.C.

"Core inflation is still high, service inflation is high. For the June meeting we will get our projections, so we will get our new forecasts and if there is a confirmation that inflation is really going down and we will achieve our target in 2025, as I said, the probability is becoming higher that this rate cut is here for the June meeting," Nagel said.

When asked about wage price pressures still lingering in the euro area, he said that in Germany there is still some wage momentum but that it was broadly still on a downward trajectory. On energy prices, he said a recent uptick in oil prices — compared with last year — was an "uncertainty" in what he described as a volatile environment.

"I think we learned a lesson in 2022, we are exposed to all this," he said regarding a crisis in Europe that was particularly acute for the industrial sector in his homeland.

"We are more resilient than maybe we were two years ago. But nevertheless if oil prices, energy prices, are going up this is not only something for Germany — this is for all of us."

Several ECB officials have made remarks about their expectations for interest rates in recent days.

Earlier Wednesday, Mario Centeno, governor of Portugal's central bank, said it was "about time to change this monetary