It's good timing because it will have the customers "blaming Europe" for the cost increase rather than the Telcos.

As I stated also above - this raise is not only observed in Latvia, Lithuania, but across eastern countries in EU as well. You ask about the reason - how about "let's try to compensate the loses", or "let's try as a preventive action", etc. Now - I believe they are not going to keep this long down the road. You said "if people are willing to pay", but that should really be the question - are they? We'll see. I personally will downgrade my plan, as a reaction to theirs. What is important and strange, that even with less national data, there is a lot more in roaming.

In fact I suspect the raise in prices has nothing to do with this.

Inflation in LT and LV is between 3% and 4% now, and salaries are also growing at about 5%.

This is probably not true in this case, but in markets with lots of competition, raising the costs raises prices because companies are already providing services close to cost.

Even in less competitive markets, raising the cost of providing a service will shift the supply curve, which can result in increased prices.