Inflation figures produced another surprise today after the underlying rate rose by more than expected to two per cent.

Analysts had been expecting a more modest 0.3 per cent increase in July's figure from the record low seen the previous month of 1.5 per cent.

Today's data from the Office for National Statistics (ONS) casts doubt over whether the Bank of England will now sanction another interest rate cut to lift the faltering economic recovery.

The underlying figure, which strips out mortgage interest payments, is 0.5 per cent short of Chancellor Gordon Brown's 2.5 per cent target.

The ONS said the inflation rise largely stemmed from one-off base effects, with the fall in seasonal food prices much less than a year ago.

It added: "Prices of fresh fruit and vegetables decreased overall in July by less than last year when the recoveries in supplies led to substantial falls in prices."

Clothing, footwear and furniture prices also contributed to the rise, with the impact of summer sales much less than last year. The headline rate, which includes mortgage interest payments, also rose 0.5 per cent to 1.5 per cent.

The underlying rate was last higher in April when the figure stood at 2.3 per cent. Since then, economists have been surprised by a 0.5 per cent fall in May's figure and 0.3 per cent in June.