Bundesbank President Joachim Nagel is crossing the wires again following his remarks that were least heard on Saturday that said the European Central Bank (ECB) needs several more rate hikes to tame inflation.

Today, he said that the central bank must withdraw support quickly, but ''not stop too early'', with regard to what is expected to be a deep recession in Germany.

"Further interest rate hikes will be needed to bring the inflation rate back to 2% in the medium term – not just at the monetary policy meeting at the end of October," Nagel said in a speech in Washington on the weekend.

"The ECB Governing Council must not let up too soon."

Markets currently price in a 75 basis point move on Oct. 27, the same as September's increase, and few if any policymakers have pushed back publicly on these expectations.

"As monetary policy continues to normalise, we will also need to look into scaling back Eurosystem asset holdings, which amount to almost 5 trillion euros," Nagel added.

"GDP (in Germany) could decline significantly in the final quarter of 2022 and the first quarter of 2023," Nagel said. "This would imply a recession, that is a significant, broad-based and longer-lasting decrease in economic output."

EUR/USD update

EUR/USD remains on tenterhooks as the euro bloc struggles with gas shortages. On the day it is higher but remains in the bear's lair while tucke din below daily trendline resistance: