(March 19): Cutting European Central Bank borrowing costs could help prevent a euro-area recession, according to Governing Council member Mario Centeno.

“At the moment we aren’t talking about recession in the euro area — the region has been stagnant in economic terms for practically a year and a half,” he said on Monday. “Probably when the decline in interest rates starts to materialize, it will be one of the factors that can help avoid the appearance of a recession.”

ECB officials are closing in on a first reduction in interest rates in June — once they’re convinced consumer-price gains are returning durably to 2%. Greece’s Yannis Stournaras told Bloomberg last week that he’d like to see two cuts before the ECB’s August break, followed by another two by year-end.

Centeno, who heads the Bank of Portugal, warned that if financing conditions are tightened “too much, we can end up not only taking inflation to values that are lower than desirable, but also provoke an economic contraction beyond what would be necessary.”

He also told students at an event in Lisbon that financial stability is a prerequisite for price stability.