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Treasury head Rachel Reeves has announced she is preparing "targeted measures to address cost of living pressures" in the upcoming financial statement.

In comments to media outlets, she noted that curbing price rises is a shared responsibility of both the administration and the central bank.

The UK's inflation rate is forecast to be the highest among the Group of Seven advanced economies this calendar year and next.

Potential Energy Cost Measures

Reports indicate the government could take action to reduce utility costs, for instance by slashing the present 5% rate of value-added tax applied on energy supplies.

A further approach is to cut some of the policy costs currently added to bills.

Budgetary Limitations and Expert Predictions

The government will obtain the latest draft from the independent fiscal watchdog, the OBR, on the start of the week, which will show how much space there is for these actions.

The view from most economists is that the Chancellor will have to announce tax rises or budget cuts in order to meet her declared borrowing rules.

Previously on the same day, estimates showed there was a £22 billion deficit for the chancellor to address, which is at the lower end of expectations.

"There's a joint responsibility between the central bank and the administration to continue tackling some of the drivers of price increases," Reeves told reporters in Washington, at the yearly gatherings of the International Monetary Fund and global financial institution.

Revenue Pledges and International Issues

While much of the focus has been on likely tax increases, the Treasury chief said the latest figures from the OBR had not altered her vow to manifesto promises not to increase tax levels on income tax, VAT or National Insurance.

She attributed an "uncertain world" with increasing geopolitical and trade tensions for the fiscal tax moves, probably to be directed on those "most able to pay."

International Trade Disputes

Referring to apprehensions about the UK's economic relations with China she said: "Our security interests always take priority."

Last week's declaration by China to tighten trade restrictions on rare earths and other resources that are crucial for advanced tech manufacturing led US President Donald Trump to suggest an additional 100% import tax on goods from China, increasing the risk of an all-out commercial conflict between the two largest economies.

The American finance chief described China's action "economic coercion" and "a global supply chain control attempt."

Questioned on considering the US offer to participate in its battle with the Asian nation, the Chancellor said she was "very concerned" by Chinese actions and called on the Beijing authorities "to avoid restrictions and limit trade."

She said the move was "harmful for the international commerce and creates further challenges."

"I believe there are sectors where we need to address China, but there are also valuable chances to trade with China's economy, including banking sector and other areas of the economic system. We've got to achieve that balance right."

The Treasury chief also affirmed she was collaborating with other major economies "regarding our own critical minerals plan, so that we are more independent."

NHS Medicine Pricing and Investment

The Chancellor also admitted that the price the NHS spends on pharmaceuticals could rise as a result of current talks with the US government and its drugs companies, in return for lower tariffs and capital.

A number of the biggest global pharmaceutical manufacturers have said recently that they are either pausing or abandoning operations in the United Kingdom, with some attributing the low prices they are receiving.

Recently, the government science advisor said the price the NHS pays for drugs would have to rise to prevent firms and pharmaceutical investment departing from the UK.

Reeves stated to media: "It has been observed because of the cost structure, that medical research, new drugs have not been available in the UK in the manner that they are in other EU nations."

"The objective is to guarantee that individuals receiving treatment from the National Health Service are can receive the best essential drugs in the globe. And so we are looking at this situation, and... seeking to secure additional funding into the UK."