Mortgage borrowers grappling with high repayments suffered a blow to their hopes for interest rate cuts after inflation held steady at 2pc last month.

The consumer prices index (CPI) was unchanged from 2pc in May, according to the Office for National Statistics.

It was higher than estimates from economists of a drop to 1.9pc and its lowest reading since April 2021.

In a blow to hopes of interest rate cuts, closely watched services inflation, which tracks categories such as hospitality, culture and housing, was unchanged at 5.7pc in June, which was higher than economists’ estimates.

The Governor of the Bank of England, Andrew Bailey, stressed last month that policymakers need “to be sure that inflation will stay low”, which is why it decided to hold interest rates at 5.25pc “for now”.

Policymakers make their next decision on interest rates in August.

Read the latest updates below.