Citing people familiar with the debate, Bloomberg reported early Thursday, “European Central Bank (ECB) officials are starting to accept that interest-rate increases might need to continue in September to bring inflation fully under control.”

The sources said, “some policymakers from across the spectrum of the European Central Bank Governing Council are speculating that two further expected quarter-point hikes may not be sufficient to tame consumer prices.”

Market reaction

At the time of writing, EUR/USD is trading modestly flat at 1.0980, uninspired by the hawkish ECB expectations.