ECB's Villeroy: euro area growth is resilient. The main problem is inflation

ECB's Villeroy is speaking and says:

• Euro area growth is resilient
• Main problem is inflation in the short-term
• ECB must normalize monetary policy because of broadening inflation
• ECB will bring inflation back to 2%
• Policy will week normalize, not tightened
• In the short-term, deal on rate hike is probably done
• We have no FX target but FX rate do matter
• FX rates matter as they influence imported inflation

ECB's Lagarde indicated the expectations that the ECB rate would move toward positive territory by the end of the 3rd quarter. That applies to 25 basis point hikes at the July and September meetings.

There are others on the board who would like a faster pace including a 50 basis point hike to launch the upside normalization.