0702 GMT - While the rise in U.K. inflation in July to 2.9% from 2.6% marks the start of a gradual increase, it is unlikely to spur the Bank of England into raising rates, KPMG's Yael Selfin says in a note. Domestic price pressures are moderating and inflation is broadly in line with the BOE's latest projections, she says. Encouragingly, underlying inflation continued to ease in July, Selfin says, with services inflation slowing to 3.4% from 3.6%. Given that the labor market is softer than in 2022, higher energy costs are unlikely to trigger significant second-round effects over the coming months. "We expect interest rates to remain unchanged for the remainder of the year," she says.
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