European Central Bank (ECB) Chief Economist Philip Lane reiterated on Wednesday that it was appropriate to normalise the monetary policy, as reported by Reuters.

Additional takeaways

"Eurozone inflation is still moving towards ECB's 2% target in the medium-term."

"The fact that households are upwardly revising their inflation beliefs is a concern."

"Uncertainty about war and inflation requires a lot of flexibility."

"It is an important principle that "If you ignore the problem" you will have to address it later on, but we have not ignored the problem."

"Exact speed of subsequent monetary policy moves after Q3 will be decided depending on the economy."

Market reaction

The EUR/USD pair showed no immediate reaction to these comments and was last seen losing 0.6% on a daily basis at 1.0670.