European Central Bank expected to cut interest rates for first time in five years

A 0.25 percentage point cut to main lending rate is forecast amid growth in Germany, Italy and Spain

The European Central Bank is expected to cut interest rates for the first time in almost five years at its meeting on Thursday after a survey of private sector businesses showed activity expanded at the fastest pace in a year while inflation cooled.

The latest HCOB purchasing managers' index (PMI) data, compiled by S&P Global, showed private sector output expanded in most economies covered by the euro currency after growth in Germany, Italy and Spain was only marginally offset by a downturn in France.