FRANKFURT (Reuters). ECB member Isabel Schnabel said Tuesday that the European Central Bank could need to increase interest rates by July in order to stop excessive inflation.

The record-breaking 7.5% inflation rate was reached last month. Even underlying price growth (which filters out volatile food and energy prices) is approaching 4%. This suggests that even if oil prices fall, high prices could continue to rise.

Handelsblatt quoted Schnabel’s statement as saying that “talking isn’t enough. It’s time to do something.” I believe a July rate rise is possible from today’s point of view.

Any rate rise must precede the end to bond purchases. This could happen at the end June according to Schnabel, the head of market operation for the ECB.

Conservatives from the ECB’s 25 member Governing Council are calling for the bank to reduce its excessively easy inflation policy. Many expect to see 2 to 3 rate rises by the end of this year.

Since 2014, the ECB has not raised interest rates since 2011. Its benchmark deposit rate of minus 0.5% is still negative.

Markets are currently pricing in 97 basis point rate rises for the rest year. It indicates that an increase is expected at every policy meeting beginning July.

Next meeting of the ECB is scheduled for June 9. This will be followed by a July 21 meeting.

Schnabel stated that she didn’t expect the euro area to enter stagflation – a period with low growth combined with high inflation – but added that the main purpose of the ECB was to prevent rapid price growth, not support the economy.

However, she said that any increase in yields between core and peripheral blocs would be addressed by the ECB.