“The European Central Bank (ECB) could consider raising its key interest rate as high as 4% if underlying inflation in the euro zone remains persistently high,” said ECB Governing Council member Pierre Wunsch early Friday in Asia per Reuters.

“If the core inflation would remain at the level we see today in Europe of above 5%, and if we don't get clear signals that core inflation is going down, we will have to do more,” added the Belgian national bank Governor Wunsch in a news conference at the bank said Reuters.

ECB’s Wunsch also said, “For me, looking at rates of 4% would not be excluded but I want to insist I won't make any judgment on where the rates would have to go without seeing the developments of core inflation.”

EUR/USD grinds lower

Given the early hours of trading, the EUR/USD pair fails to react to the news and grinds near the 1.0600 mark. However, the bears seem to have run out of fuel of late.

Also read: EUR/USD pares weekly gains around 1.0600 as ECB, Fed officials back higher rates to tame inflation