More than 600,000 homeowners face a hike in mortgage payments after the European Central Bank has announced a 0.25 percentage point rise in interest rates.
And the ECB president Jean Claude Trichet dropped hints that a second rise would be on the way later this year.
He raised the interest rates to curb inflation in Germany, but a a press conference said the ECB will continue to 'monitor very closely' inflation risks in the eurozone.
Economists had said that the use of the phrase 'monitor very closely' would signal that another interest rate increase was likely this year.
Another rise of rise of 0.25pc is widely expected, which would add €15 a month to a €100,000 mortgage.
It means someone with a mortgage of €300,000 would see their monthly payments rise by €45 a month.
More than half of the 780,000 mortgage holders have a tracker mortgage which follows the ECB rates with another 250,000 or so on standard variable deals.
Trichet ducks question on mortgage pain in Ireland
Asked about the effect of an interest rate increase on Ireland and other struggling eurozone countries, Mr Trichet said the ECB had a responsibility to deliver price stability to 331m people in the eurozone.
Ireland benefited as much as any other country from stable prices, he said.
Also on Ireland, he said the latest figures showed that its 'results are going in the right direction'.
The ECB also increased its rates in April, becoming the first major central bank to lift interest rates after the financial crisis.
Eurozone inflation remained at 2.7% in June, softer than expected but well above the ECB's target of just under 2%.
Inflation is thought to have inched higher because of oil and commodity prices.
ECB policies will damage recovery - Martin
Fianna Fáil leader Micheál Martin has claimed that ECB interest rate policies will do great damage to recovery prospects in the eurozone.
In a strongly worded statement, Mr Martin said in a week when there were signs of economic recovery, raising interest rates was more than foolish and would threaten the euro itself.
He said that Taoiseach Enda Kenny had repeatedly refused to raise what he called the 'flawed' policy with EU leaders.
Mr Martin said new ECB President Mario Draghi had said he favours higher interest rates and has opposed moves on bondholders.
He asked who would speak up for this country if Enda Kenny would not.
The Fianna Fáil leader said there was a clear need for a review of and reforms to what he said was an increasingly 'arrogant' organisation.
Meanwhile, Sinn Féin Finance Spokesperson Pearse Doherty said the Government has done nothing to prepare for the rise in interest rates.
Mr Doherty said: 'We have known about this hike for some time. Despite this the Government has done nothing to prepare for the huge impact this will have on over 200,000 mortgage holders and many small businesses across the country.
'The Programme for Government has a clear commitment to force banks to absorb the impact of these interest rate rises in order to protect vulnerable mortgage holders and small businesses.
'The Government needs to stop burying its head in the sands on this issue and start to stand up for the interests of struggling mortgage holders, businesses and the Irish economy,' he added.
