"Mary "remained a virgin in conceiving her Son, a virgin in giving birth to him, a virgin in carrying him, a virgin in nursing him at her breast, always a virgin" (St. Augustine, Serm. 186, 1: PL 38, 999): with her whole being she is "the handmaid of the Lord" (Lk 1:38)." (CCC # 510)
The term "knew" was a modest way of describing sexual relations. That is how it is used in various places throughout the Old Testament (Genesis 4:1; 17; 25; Judges 11:39). To know carries with it connotations of people being intimate with each other. This idea of "knowing" is also expressed in the context of the covenant relationship between God and Israel (Amos 3:2; Hosea 2:14-23).
Children in Jewish culture were viewed as blessings from God (Psalm 127:3-5). The wife was likened to a vine and children to olive shoots (Psalm 128:3). Children were viewed as a sign of divine favor. In fact, women who were unable to bear children felt humiliation and attributed their condition to some underlying sin or wrongdoing. Rachel preferred death over childlessness (Genesis 30:1). This backdrop seriously weakens the Roman Catholic view of Matthew 1:25.
If we understand the clause "until" in Matthew 1:25 to indicate a change in the virginity status of Mary, then that reading would lend support to the virgin birth. It would further emphasize the fact that Jesus was not born as a result of sexual relations. The New King James Version Study Bible has this footnote: "Joseph could not have had children by a previous marriage, as some suppose, for then Jesus would not have been heir to the Davidic throne as the eldest son of Joseph."
The Catholic dogma of Mary's perpetual virginity is absurd and bizarre. It is completely out of touch with the reality that the Old Testament speaks positively of childbearing. The context of Matthew 1:25 centers around the marriage of Mary and Joseph. Matthew does not give us any indication whatsoever of Mary being a perpetual virgin. Why would a man abstain from sexual relations with his wife?
God created the sex act. It is a part of His created order. He pronounced His work to be good upon finishing it (Genesis 1:31). It is that of perfection. The things that He creates for us are to be appreciated. Sex within the confines of marriage does not spiritually defile a person. Only one who has prior theological commitments will take issue with Matthew 1:25 being a reference to marriage consummation.