ECB Expected to Raise Rates as German Industrial Production Dips

The European Central Bank (ECB) is widely expected to raise its key interest rates by 25 basis points at its upcoming monetary policy meeting on Thursday. The decision comes after Germany's Industrial sector activity fell by 1.6% YoY in July, compared to a decline of 0.5% in June.

Andrew Kenningham, chief Europe economist at Capital Economics, is confident that the ECB governing council will raise its deposit rate from 2.25 percent to 2.5 percent.

The Bank of England (BoE) Chief economist Huw Pill has also hinted that the central bank could lift interest rates without kickstarting a lengthy period of sharp increases.