Simkus rate hike comments showed that he expects at least one more ECB increase to address inflation risks.
He said the central bank still needs to tighten policy further. According to Simkus, upside risks to inflation remain strong enough to support another move. He also said broader price pressures add to the case for more action.
Simkus Rate Hike View on Inflation
Simkus said keeping inflation expectations under control remains a key goal. He stressed that this is central to keeping inflation near target over the medium term. Moreover, he said the ECB must lean against inflation risks as it weighs its next step.
His remarks matched the broader ECB view on avoiding second-round effects. Meanwhile, markets had priced in two ECB rate hikes by year-end. However, those expectations eased after a breakthrough in US-Iran talks.
Traders now expect one final increase, according to the report.
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