Higher food and airfare prices pushed U.K. inflation above expectations in July. The development has tempered market expectations that the Bank of England will cut interest rates again this year.

UK inflation climbed for a second month in July, adding pressure on the Bank of England to reconsider its pace of interest-rate cuts.

Where inflation jumped in July – and where it eased - Inflation picked up pace last month for everyday items including eggs, potatoes, breakfast cereals and bread.

UK inflation unexpectedly accelerated in July, stoking fresh fears about the cost of living and all but extinguishing hopes for another interest rate cut this year from the Bank of England.

In July, headline consumer price inflation in the UK rose at an annual rate of 3.8 per cent, above market expectations of a 3.7 per cent rise and stronger than June’s 3.6 per cent increase. It was in line with BoE expectations.

FTSE 100 Live Wednesday Inflation rise clouds rates outlookRail fares set for big hikeCostain revenues hit by HS2 delays Market update: FTSE 100 lower, building stocks under pressure 10:03 ,

Japan's core inflation rate in July likely slowed from the previous month but remained above the Bank of Japan's 2% target, a Reuters poll showed, adding to pressure on the central bank to raise interest rates.

After somewhat positive inflation data in July, the chances of the Federal Reserve cutting interest rates in September are at roughly 83%, according to CME Group 's FedWatch tool calculations on Aug. 18. One month earlier, roughly 59% of traders betting on changes in the federal funds rate thought an interest rate cut would occur in September.