The consumer price index including owner occupiers' housing costs 12-month inflation rate was 2.6 percent in July, the same rate as in June.
Today's inflation figures from the Office for National Statistics show the headline rate remaining flat at 2.6% - contrary to the expectations of many who thought the bounce in commodity prices would drive an increase this month.
Retail as well as wholesale inflation turned sharply higher in July, but remained far below the RBI's comfort level of 4 per cent, leading to the chorus of lower rates getting louder. Nayar said prices of various vegetables have displayed a month-on-month hardening so far in August and in addition, a reversal of the favourable base effect could result in retail food inflation rising further in the ongoing month.
The index for primary articles rose by 4.3% from June's 126.9 to July's 132.4.
However, this was offset by a downward pressure from motor fuel prices, with prices falling 1.3 per cent in July, the fifth successive monthly decrease. That figure could prove controversial, however, given that United Kingdom rail fares are linked to RPI rates, and thus train operators will be able to increase ticket prices by 3.6% in January 2018.
The RBI expects retail inflation could accelerate to 3.5 per cent to 4.5 per cent in October-December.
Households have seen their spending power come under sustained pressure from lacklustre wage growth and higher inflation, triggering an increase in credit and a decline in savings.
"The UK home grown prices are still somewhat muted and it is something which the [Bank of England's monetary policy committee] is comfortable about", said Naeem Aslam, chief market analyst at Think Markets.
United Kingdom inflation surprisingly held steady in July, reducing some of the pressure on the Bank of England for a rate hike but keeping up the squeeze on household budgets. This is all the more important given the state of industrial sector where growth is anaemic... The core CPI inflation was almost flat at 3.81% in July 2017 compared with 3.75% in June 2017.
But Tuesday's data showed this eased to a one-year low of 6.5 percent in July, down from 10.0 percent in June.
Andrew Goodwin, lead United Kingdom economist at Oxford Economics, said falling fuel prices will continue to weigh on the cost of living in July, keeping CPI at 2.6%.