FRANKFURT / Reuters – It would be counterproductive to tighten monetary policy in order to manage the inflationary pressures currently affecting the euro zone, Philip Lane of the European Central Bank said Monday. He was largely echoing recent bank policy stances.

As the annual inflation rate surpassed 4% in the last month, which is more than double the ECB target of 2%, there has been increasing pressure on the bank’s ultra-easy monetary policies. The markets now price in a rate increase next year.

Lane argued, however that inflation can be driven by temporary factors. ECB policies are ineffective at addressing rapid price growth right now because it’s likely to disappear on its own.

In a speech, he stated that “an abrupt tightening in monetary policy today would no lower the currently high rates of inflation but would serve slow down and reduce employment over two years to reduce medium term inflation pressure.”

He said, “Given that we believe the medium-term inflation trajectory is still below our target of 2%,” he continued.

Christine Lagarde (ECB President) and a group of Governing Council Members reacted negatively to market expectations last Wednesday, arguing the conditions required for a rate rise as explained by bank guidance were not likely to be met next fiscal year.

Lane stated that it is crucial to monitor inflation’s durability, but Lane also said that a large rise in wages in the next few months does not always indicate a trend shift. It could be temporary.

His statement was that “a shift in wage levels as a result of an adjustment to a temporary increase in price does not necessarily indicate a shift in trend of underlying inflation.”