Institution: UK inflation data may mean that the Bank of England will not raise interest rates this year.

Investec's Sandra Horsfield stated in a report that the UK inflation data further supports the reason for the Bank of England to not raise interest rates at all this year, but instead to keep rates stable. The inflation rate in May remained at 2.8%, painting a more optimistic picture than expected, with only two categories of inflation transport and the less impactful communication pushing up the overall inflation rate. The release of this data should reassure decision-makers that there is no urgency to raise rates, even though the money market reflects expectations of a rate hike this year. "We believe that in an economy where a more turbulent job market restricts the risk of a second round of inflation accumulation, even that may be unnecessary," Horsfield said.