ECB's Makhlouf says the central bank must be prepared to lift interest rates further and that the combination of eurozone inflation above 3% and robust growth makes him uneasy, according to FT

Makhlouf has in the past sat toward the hawkish end of the Council's spectrum, so the tell is whether the language migrates toward the median voter, since it is the centre of gravity and not the wings that sets the deposit rate path. The mechanism runs through the short-dated ESTR strip and the pricing of hikes versus holds at the next two meetings, with peripheral spreads a secondary channel if the rhetoric hardens into a sustained tightening bias. The stated rationale, inflation above a stated threshold alongside robust growth, mirrors the justification used in past episodes when tightening cycles extended further than markets had priced, though single-member commentary has on previous occasions preceded no change in stance. The follow-ons are the run of Council speakers over coming days and the next round of inflation and staff projection data, which determine whether this reads as an outlier or an opening bid.