European Central Bank (ECB) President Christine Lagarde warned on Wednesday that caution should be exercised in easing monetary policy in the context of disinflation.

"We need to be cautious because data will come up and will indicate to us the state of the economy," Lagarde said, reiterating the ECB's flexible stance.

Moreover, Lagarde stressed that despite the recent cuts, economic conditions could change based on new data. "We do not have a linear systematic sequence," she added.