ECB’s Knot: Will keep tightening policy until we see inflation returning to 2%

European Central Bank (ECB) policymaker Klaas Knot said on Tuesday, “we will keep tightening policy until we see inflation returning to 2% but this must be done step by step.”

Additional quotes

“Inflation still way too high but the worst is behind us.”

“Underlying price pressures will prove more difficult to bring down.“

“Seeing first signs that monetary policy tightening is being transmitted to real economy.”

Market reaction

EUR/USD was last seen trading at 1.0717, modestly flat on the day, despite the hawkish remarks from the ECB official.