Alvaro Santos Pereira, a member of the European Central Bank (ECB) and governor of the Bank of Portugal, has expressed the urgency of addressing inflation risks in the euro zone. Speaking to Portugal’s Antena 1, he stated that the ECB must remain vigilant and may need to take action sooner rather than later to prevent inflation from becoming entrenched. Pereira noted that historical precedents indicate central banks should respond swiftly when inflationary pressures emerge. He emphasized the need for a rapid policy response if inflation shows signs of spiraling out of control, particularly given the current economic climate marked by rising energy prices and geopolitical tensions. While he refrained from directly indicating support for an interest rate hike at the ECB's next policy meeting, Pereira mentioned that policymakers will evaluate updated economic forecasts and incoming data before making decisions. The upcoming meeting is expected to provide new estimates on growth and inflation, crucial for shaping the ECB's policy outlook for the remainder of the year.