European shares opened lower on Thursday, as the European Central Bank (ECB) was expected to raise borrowing costs later in the day, the decision coming on the heels of the U.S. Federal Reserve signalling more hikes.

Losses were capped somewhat by a rise in shares of H&M, which lifted retailer stocks after it flagged sales in June, the first month of its third quarter, had got off to a good start.

The continent-wide STOXX 600 index fell 0.3% by 0708 GMT. European retailers gained 0.9%, with Sweden’s H&M up 5.3%

The ECB is seen increasing the deposit rate by 25 basis points to 3.5% later in the day, the highest level in 22 years and leave the door open to further hikes extending its battle against sticky inflation even as the eurozone economy lags.

The Fed left interest rates unchanged on Wednesday but signalled at least half of a percentage point increase to borrowing costs by the end of this year.