European Central Bank policymakers defended the upward march of euro zone interest rates as mixed economic data put fresh pressure on the ECB to justify its stance.
Investor confidence in Germany plunged to a near eight-year low partly due to worries about tighter ECB monetary policy, fanning concerns that more rate increases would choke economic growth.
German Finance Minister Peer Steinbrueck renewed his calls for the central bank to tread carefully.
But consumer confidence in Italy jumped, underscoring the mixed pattern of recovery in the euro zone which is growing at its best pace in over five years.
ECB Governing Council members Axel Weber and Guy Quaden said that higher rates were not at odds with continuing growth, adding to a barrage of tough talk over recent days which has prompted many investors to rethink how high rates will go.
"For us, it is not about short-lived upswing but about consistent, lasting growth," Weber said in an interview with Germany's Frankfurter Allgemeiner Zeitung.
The ECB has raised rates four times since early December while the euro zone economy enjoys its best growth in more than five years and inflation remains high.
Quaden, who heads the Belgian central bank, said the ECB could fight inflation while still supporting the economy.
"Our goal is price stability as you know. It's not in contradiction with the support of economic growth and since we started to normalise interest rates in the euro zone at the end of last year, the economic growth continues to develop in the euro zone," he told news agency Market News.
Politicians are not convinced, however. Steinbrueck urged ECB caution, a stance shared in the past month by colleagues in France and Austria.
While noting it was an old rule that politicians should never comment on interest rates, Steinbrueck told Bloomberg Television: "I would be grateful if (the ECB) took into account the effect rates have on government debt and growth."