European Central Bank (ECB) policymaker Klaas Knot said on Tuesday that he was leaning toward a 75 basis points rate hike in September but added that he was open to discussion.

Knot further argued that going back to neutral would not be enough to tame inflation and added that they could see labour hoarding in the initial phase of economic slowdown.

Market reaction

EUR/USD retreated from daily highs in the early American session but was last seen moving in positive territory above parity.