FRANKFURT, June 7 Reuters European Central Bank policymakers warned on Friday that the final stage of pushing inflation down to 2 could be especially hard but said they were confident that policy was working as intended, while some even saw room to ease policy further in 2024.

The ECB cut interest rates from record highs on Thursday in a longtelegraphed move, but held back from any pledge to ease policy further after inflation and wage growth data in recent weeks came in above its expectations, indicating it will need even longer to meet its target.

The biggest warning came perhaps from Germany, the euro zone39;s largest economy, which poured cold water on suggestions that a big wage jump this year was a oneoff.

Negotiated wages are expected to rise particularly sharply this year and continue to see strong growth thereafter, the Bundesbank said. Inflation is proving to be stubborn, especially in the case of services.

Wage rises increase disposable incomes and thus put upward pressure on prices, particularly in wage sensitive sectors like services.

Bundesbank chief Joachim Nagel said Thursday39;s rate cut was not premature given the progress on inflation but he also said the ECB would not be on auto pilot for further rate cuts.

Austrias Robert Holzmann, the only policymaker to oppose Thursdays cut, said that inflation was stickier than the ECB predicted, so the bank needed to act more cautiously in the future.

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