British consumer price inflation fell by less than expected to 8.7% in April from March's 10.1% and a measure of core inflation unexpectedly rose, figures from the Office for National Statistics showed on Wednesday.

The data are likely to reinforce expectations that the Bank of England will be forced to raise interest rates again.

Economists polled by Reuters had forecast that the headline CPI annual rate would drop to 8.2% in April, moving further away from October's 41-year high of 11.1%.

Earlier this month, the BoE forecast inflation of 8.4% for April.

Ahead of the inflation data release, financial markets had fully priced in Bank Rate rising to 5% by the end of the year, from 4.5% now.

Sterling rose against the U.S. dollar and the euro after the figures were published.

Core inflation, which excludes energy, food and tobacco prices, rose to 6.8% - the highest rate since March 1992.

Despite the most recent fall, inflation continued to eat into the spending power of workers whose pay is rising by less.

The BoE is due to announce its next decision on rates on June 22. (Reporting by Andy Bruce Editing by William Schomberg and William James)