FRANKFURT (Bloomberg) — European Central Bank council member Klaus Liebscher said inflation risks are "clearly on the upside" and economic growth is "robust".

"We have oil, energy, commodities plus foodstuffs, plus capacity constraints, labour-market constraints, higher wages," Liebscher said at an event in Vienna yesterday. "There's a good number of reasons why we can't be complacent."

The ECB has left its key rate at four percent since June to assess the risks to growth including a US housing slump, which pushed up credit costs. At the same time, a surge in oil prices has driven up inflation, raising the risk that workers will push for more pay to compensate for higher costs.

Liebscher expressed confidence in the economic outlook, saying even though "downside risks are predominant," there's "still robust, ongoing economic growth in the euro area." He cited an unexpected increase this month in business confidence in Germany, the region's largest economy.

The ECB's 19-member governing council is split over whether to raise interest rates further.