ECB’s Kazāks: ‘There’s No Urgent Need to Moves Rates’

25 July 2025

By David Barwick – FRANKFURT (Econostream) – The European Central Bank is in no rush to change its key interest rates, ECB Governing Council member Mārtiņš Kazāks said Friday.

In an interview with Bloomberg following Thursday’s decision by the ECB to leave rates unchanged, Kazāks, who heads Latvijas Banka, said, ‘There is no need to be jumpy — there’s no urgent need to move rates. Given our sizeable and continued cuts over the last year, there’s still a lot of monetary easing to work through the economy.’

‘There is value in holding rates at the current levels and the time of no-brainer moves to hike or cut is over’, he was quoted as saying. ‘At the current juncture, a steady-hand policy is appropriate.’

The euro exchange rate had covered a lot of ground ‘quite quickly’, but its current level was still only near its historical average, he said, urging to keep in mind the context of the common currency’s weakening late in 2024.

‘However, we will monitor this closely’, he said.

Policymakers would be well advised to await a specific trade deal, he said. ‘Given that politicians might shift their views quickly, it’s better to wait and to act on decisions rather than on speculations’, he said.

According to Kazāks, there was ‘some untapped growth potential’ in the euro area economy. ‘[I]f the trade dispute is resolved quickly and excessive uncertainty is removed, some improvement in confidence may support investment and consumption, thereby reducing the clearly negative impact from the tariffs.’