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A major part of the recent increase in eurozone yield was caused by better fundamentals, as well as  improving inflation and growth outlook, European Central Bank (ECB) governing council member Klaas Knot said on Monday, as reported by Reuters. However, Knot also acknowledged that some of the rise was unwarranted.

“Once the economic improvement materialises, the reason to front-load asset purchases disappears,” Knot added.

Market reaction

The shared currency continues to gather strength against its rivals following these comments. As of writing, the EUR/USD pair was up 0.22% on a daily basis at 1.1930.