The European Central Bank will need to keep borrowing costs high for some time, according to Bundesbank President Joachim Nagel.

“Our tight monetary policy is working, but we mustn’t let up too soon,” the German central bank chief said Tuesday in a speech in Berlin. “Rather, the key interest rates will have to remain at a sufficiently high level for a sufficiently long time.”

Nagel spoke five days after the ECB kept rates unchanged for the first time in more than a year. President Christine Lagarde has indicated that another hike isn’t currently required and markets and economists expect borrowing costs to stay at this level well into 2024.

Addressing a separate event in Spain, ECB Vice President Luis de Guindos said the existing 4% deposit rate will help bring inflation back to target.

“It’s not yet possible to say whether interest rates have already reached their peak: We remain strictly dependent on data,” Nagel said. “Our monetary-policy stance must ensure that inflation returns to 2%. Inflation has proven stubborn and hasn’t yet been defeated.”

Other Governing Council members have made similar comments that it’s too early to discuss cuts, though Yannis Stournaras of Greece told the Handelsblatt newspaper that he may be willing to consider such a move if inflation falls “permanently and sustainably below the 3% threshold in mid-2024.”

Data earlier Tuesday showed that euro-area inflation eased to 2.9% in October — its lowest level in more than two years. But the journey ahead is likely to be bumpy, with Bloomberg Economics’s Nowcast model sees a small uptick in inflation to 3.1% in November.

Nagel stressed that underlying price pressures, which strip out things like food and energy costs, remain high and volatile.

“There are several upside risks to inflation,” he said. “Geopolitical tensions in the Middle East could drive up energy prices and make the medium-term outlook more uncertain. The people of the euro area rightly expect us to do our job and ensure price stability. That’s my top priority.”

The main thing now will be to stay the course, according to the German official.

“We mustn’t become nervous or complacent too soon,” Nagel said. “We have to wait and see how the effect of monetary policy will turn out due to the great uncertainties.”

--With assistance from Rodrigo Orihuela.

(Updates with Guindos, more comments from Nagel starting in fourth paragraph.)