The October move should then be followed by another step that takes the ECB to what policymakers call the neutral rate, which neither stimulates nor slows growth, ending a more than decade-long experiment with ultra-easy policy. "In my view, we are heading towards the range of the neutral rate by Christmas," said Rehn, 60, a potential Finnish presidential candidate who often tops opinion polls. While undefined, the neutral rate is seen somewhere between 1.5% and 2%, well above the ECB's 0.75% deposit rate. "For euro zone inflation, there is one driver above others and one anchor more important than others," Rehn said. While a downturn is increasingly likely to morph into a recession given sky-high energy prices and potential energy shortages, Rehn argued this was still a small price to pay.

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