The European Central Bank (ECB) has raised key interest rates by an unprecedented 0.75%.

The ECB said the "major step frontloads the transition from the prevailing highly accommodative level of policy rates towards levels that will ensure the timely return of inflation to the ECB’s 2% medium-term target."

It also said it expects to raise rates further over the next several meetings.

The bank said this was "to dampen demand and guard against the risk of a persistent upward shift in inflation expectations."

It comes as inflation reached 9.1% in August.

Michael Dowling is managing director of Dowling Financial.

He told The Pat Kenny Show this will ultimately hit all mortgage holders.

"The European Central Bank has flagged that there will be additional increases more than likely in December, and again potentially another quarter to half percent.

"So we are in a cycle of interest rate increases, which are going to impact on all mortgage holders ultimately."

He said the United States and Britain have also seen interest rate increases as well.

"As an economy, Europe has lagged behind other economies in terms of increasing its interest rates.

"So there seems to be a view in the European Central Bank that we need to somehow watch what's happening in other jurisdictions."

'Rates rising in all categories'

He said people should be looking around for better deals.

"Everyone needs to be mindful of the rate they're on and seek advice as to what the most appropriate thing for them to do is."

And he advised customers to act fast on this.

"The one thing I would say to all borrowers is they've got to act quickly.

"Don’t assume, 'Ah well I’ve a couple of days after the announcement'.

"Interest rates will be rising in all categories, in my opinion, unlike the last time.

"So I would be advising customers that the very first thing you should do is talk to your own bank - see what options you have available from your own bank.

"If you can agree a new fixed rate with your own bank, there's no cost involved.

"For the sake of a phone call and just a quick check around, you can save yourself a substantial amount of money by locking in a fixed rate with your existing lender.

"If you find that the options from your existing lender are not attractive, relative to what's available on the market, seek advice from a regulated broker.

"But you do need to act quickly", he added.