UK inflation in April has reached its highest rate in 17 months, according to the Office for National Statistics.

Consumer Price Index (CPI) inflation - the measure of the average price of consumer goods and services purchased by households – reached 3.7%.

The Retail Price Index (RPI) measure, which includes housing costs, also increased to 5.3% from 4.4% recorded last month.

Bank of England governor Mervyn King will write a letter of explanation to the new Chancellor, George Osborne, as the official CPI measure remains more than one percentage point above the Bank's 2% target. King has stated that inflation will drop below the 2% target before the end of the year.

“Clearly, the MPC cannot ignore the risk that inflationary expectations could worsen. However, this risky backdrop makes it even more important for the new government to produce a detailed plan for reducing our unsustainable Budget deficit,” said David Kern, chief economist at the British Chambers of Commerce.

“If the market regains confidence in the UK’s ability to deal with the deficit, it will be easier for the MPC to maintain low interest rates for a prolonged period. Low interest rates make it possible for businesses to drive and sustain the economic recovery.”