The Bank of England is on track to raise interest rates for the first time in more than a decade on Thursday after data from manufacturers strengthened the case for an increase.

The industrial sector is reporting that it remains in rude health as companies benefited from strong sales in the UK last month and new export business driven by the weak pound. Combined with high inflation and record low unemployment, the figures pointed to the Bank raising the cost of borrowing from 0.25% to 0.5%.

“The continued robust health of manufacturing and rising price pressures will help cement expectations of the Bank of England hiking interest rates for the first time in a decade,” said Rob Dobson, a director at IHS Markit, which compiled the manufacturing data.

Factory output and new orders rose at “robust rates” last month, IHS Markit said on Wednesday. The sector has expanded for most of the year, according to the firm’s monthly survey, in response to the fall in the value of the pound, which has boosted trade, especially with booming markets in the European Union.

Forecasts that the global economy, which has expanded strongly this year, will continue to grow in 2018 have also provided factory owners with the security they need to expand production.

Against this backdrop, the Bank’s interest rate-setting committee is expected to raise its base rate in a bid to to calm inflation, which reached 3% in September. If it increases borrowing costs, the monetary policy committee is also expected to cite the lowest level of unemployment for 40 years, the continuing strength of the manufacturing and services sectors, which between them account for more than 90% of economic activity, and the need to curb a surge in consumer borrowing. Strong performances from the manufacturing and services industries also indicate that the UK can withstand an increase in rates without derailing the economy.

However, there were signs of pressure in the retail sector – a key area of the economy – on Wednesday after Next reported a fall in high street sales in October. Next’s figures came days after business group the CBI warned that high street sales are falling at their fastest rate since the height of the recession in 2009. The warnings point to soft consumer confidence and difficult trading conditions in the run-up to the crucial Christmas selling period.

Some analysts said October’s broader rise in factory output, which pushed the IHS Markit/CIPS survey to 56.3 from 56 the previous month – with any reading above 50 indicating growth – was based on a boost to domestic orders that was likely to prove short-lived.

Nonetheless, Britain’s biggest building society paved the way for across-the-board increases in mortgage costs this week by outlining how it would react to a rate rise. Nationwide announced that a 0.25% interest rate rise would be passed on in full to its 600,000-plus variable-rate home loan customers.

That would add £22 a month to the monthly mortgage bill for someone with a £175,000 mortgage, or £51 a month for a customer with a £400,000 home loan, assuming they are on Nationwide’s “base mortgage rate” and have a 25-year term. There are as many as 5 million people on variable-rate mortgages in the UK.

Deutsche Bank has predicted that the UK economy will slump next year from 1.6% GDP growth in 2017 to 1% in 2018, “due to weak household income and slowing jobs and house price growth”. And the situation could worsen if households come to see Brexit as a permanent shock, forcing them to act as they did following the 2008 crash by increasing savings and cutting back hard on discretionary spending, the bank said.