Schnabel said firms pass higher costs to consumers faster when the economy is resilient, a sign inflation pressures can persist even as rates stay elevated.
Robust credit growth suggests euro-zone financial conditions are not yet restrictive, reinforcing a hawkish read on how much ECB policy is actually curbing demand.
Rising global yields could still slow the economy more than assumed and damp price pressures, giving the ECB room to return inflation to target more gradually.
The policy question is whether higher borrowing costs finally restrain demand or whether economic resilience keeps inflation pass-through alive.