By David Barwick – FRANKFURT (Econostream) – European Central Bank Governing Council member Martin Kocher said on Sunday that the ECB would have to focus its June discussion on policy action if the economic situation failed to improve.

Kocher, who heads the Austrian National Bank, told Bloomberg that the Governing Council was currently facing a choice between holding rates steady and raising them.

“There are always scenarios with very low probabilities that lead to a different assessment of the situation, but at the moment, everything points to us deciding between holding and raising rates,” he said, according to the news agency. “And it’s clear to me that if the situation doesn’t improve, we will have to focus our discussions on acting.”

Kocher said it was too early to lock in a particular outcome for the ECB’s June 10-11 meeting.

“It would not be appropriate to commit to anything just yet, and I don’t think that makes sense at the moment, either,” he said. “Uncertainty is high, so we shouldn’t rule out too many options in advance. We’ll see what happens. The hope, of course, is that positive developments will emerge.”

Kocher suggested that the Eurozone economy was holding up reasonably well so far, despite weaker confidence and demand amid uncertainty over efforts to resolve the Iran war.

“It appears that the economy — though this is still very anecdotal and should be viewed with great caution — is relatively resilient,” he said. “But we really need to wait and see how the projections play out.”

The ECB’s June projections would be important for judging both the growth outlook and the inflation impact of the latest energy shock, Kocher said.

“Everything points to prices rising somewhat more sharply than was expected back in March,” he said.

Households were facing a second major price shock in a relatively short period, Kocher said.

“It’s also clear that this increases the pressure to act on interest rates,” he said.