By Marta Vilar – MADRID (Econostream) – European Central Bank Governing Council member Gediminas Šimkus said on Tuesday that he saw no reason for the ECB to surprise financial markets by holding interest rates steady next week.

Speaking to media, Šimkus, who heads the Bank of Lithuania, said, “I think there is no need to surprise the markets and not make decisions,” adding that in his opinion, “we have a 25bp interest rate increase in place.”

Financial markets were expecting more than one rate hike in 2026, he noted, meaning that “a significant part of that dampening effect on the economy is already factored in and is reflected to a greater or lesser extent in economic developments and decisions.”

Recent changes in consumer expectations were reminiscent of the inflation shock seen in 2022, he said.

“The way I see the changes in short-term price expectations of consumers and not only consumers - they are more reminiscent not of what was half a year ago, but of what was in 2022, when we had a fairly strong inflationary shock,” he said.