UK inflation softened last month but the picture is not simple for households or the Bank of England, with the prices of various commodities and services containing to rise.
Food, restaurants, flight fares and hotel prices all are continuing to rise, the data from the Office for National Statistic showed, while the annual rate of the consumer price index eased to 6.8% in July from 7.9% in June.
The slowing of inflation primarily was due to reduced energy costs, notably in the lower cap for electricity and gas prices.
This was in close alignment with forecasts from the BoE and for economists in the City, which expected roughly the same figure.
However the main fly in the ointment, said Deutsche Bank, was the resurgence in services inflation, the part of the CPI data the committee has been most concerned about due to it being a sign of inflation's persistence.
It picked up again from 7.2% to 7.4%, which is higher than the Bank's recent forecast of 7.3%.
On the plus side, tthis was down to two factors that are unlikely to meet the BoE’s definition of “persistent” trends, said economist James Smith at ING, rents and air fares.
A larger increase in airfares at the start of the summer holidays was seen than last year, which helped to drive services inflation higher.
"This is a highly volatile category, which the BoE itself typically removes from the index when it looks at 'core services'," said Smith.
"The bottom line is that the figures don’t carry huge implications for the Bank of England, and certainly, the unexpected pick-up in services inflation isn’t as broad-based as it has been in previous months when we’ve had unpleasant surprises."
Catering, a key driver over recent months, the annual rate is gradually coming down and he thinks this trend will continue.