KPMG has launched a fresh round of job cuts in its UK business amid a slowdown in dealmaking in the City.

The financial services and auditing giant said it will reduce roles and freeze pay in its deal advisory business.

It is understood the move, which was first reported by the Financial Times, will affect about 110 people, or almost 7% of the company’s nearly 1,700-strong UK deal advisory division.

Last month, KMPG launched a separate consultation process over plans to axe up to 125 jobs in its consulting business.

Earlier this year it had also warned that its bonus pool for employees was likely to fall this year compared with the previous year.

A challenging economic environment has driven a softening in a number of markets

A KPMG UK spokeswoman said: “A challenging economic environment has driven a softening in a number of markets, including the deals market.

“These conditions have impacted demand in certain areas, as some clients have chosen to pause or delay projects.

“We have therefore taken the difficult decision to put forward proposals to reduce our headcount in a small number of areas of our business.

“Our people are at the heart of our firm and our priority is to support them throughout this consultation.”

It comes a week after KPMG was hit with a record £21 million fine by the auditing watchdog over its work for collapsed outsourcing firm Carillion.