Homeowners may face a possible interest rate increase as early as next month after European Central Bank president Jean-Claude Trichet hinted that rates could be set to rise.
Speaking in Frankfurt, Mr Trichet said inflationary pressures had increased over the last month and that "strong vigilance" was required.
The European Central Bank left interest rates at record lows today but it may curtail some crisis support measures as it prepares the ground for a rate rise later this year.
"Strong vigilance is warranted with a view to containing upside risks to price stability," Mr Trichet said.
The ECB used the phrase "strong vigilance" repeatedly during its 2005-2007 rate hike cycle, typically one month before it raised rates, although there were exceptions to that rule. It is not clear whether the verbal signal still holds good.
Mr Trichet also said inflation pressures had increased since the ECB last met a month ago, largely due to a rise in commodity prices, adding that price risks were on the upside.
The ECB has held interest rates unchanged at the record-low 1.0 per cent since May 2009.
Today’s ECB policy meeting was not attended by Bundesbank chief Axel Weber, who shocked markets last month by dropping out of the race to succeed Mr Trichet, who is due to stand down in October. Bundesbank vice president Franz-Christoph Zeitler took Mr Weber's place.
The ECB faces accelerating inflation but its readiness to restart its 'exit strategy' may be limited by doubts about whether EU leaders will agree later this month to bolster Europe's rescue fund.
A Reuters poll late last month showed a majority of economists expect the ECB will hold fire on raising rates until at least October, though an increased minority saw a hike in the third quarter
Euro zone inflation quickened in February to 2.4 per cent, its highest level since October 2008, remaining above the ECB's target of below but near 2 per cent for the third month running.