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Treasury head Rachel Reeves has announced she is preparing "targeted steps to address cost of living issues" in the forthcoming Budget.

During an interview with the BBC, she noted that curbing price rises is a joint task of both the government and the central bank.

The UK's inflation rate is expected to be the most elevated among the G7 advanced economies this year and the following year.

Possible Energy Cost Interventions

Sources suggest the administration could intervene to lower utility costs, for example by cutting the present 5% level of value-added tax applied on energy supplies.

A further approach is to reduce some of the policy costs presently added to bills.

Fiscal Constraints and Expert Expectations

The administration will receive the next draft from the official forecaster, the Office for Budget Responsibility, on Monday, which will clarify how much space there is for such measures.

The consensus from most analysts is that the Chancellor will have to announce tax rises or spending cuts in order to meet her voluntary fiscal targets.

Previously on Thursday, analysis suggested there was a twenty-two billion pound deficit for the Treasury chief to address, which is at the more modest range of projections.

"It is a joint task between the Bank of England and the administration to continue tackling some of the drivers of price increases," the Chancellor told the BBC in Washington, at the yearly gatherings of the International Monetary Fund and World Bank.

Tax Commitments and Global Issues

While a great deal of the attention has been on probable tax increases, the chancellor said the latest data from the OBR had not altered her commitment to campaign commitments not to increase tax levels on income tax, VAT or social security contributions.

She blamed an "unpredictable world" with rising geopolitical and trade tensions for the fiscal tax moves, likely to be targeted on those "with the broadest shoulders."

Global Trade Tensions

Commenting on apprehensions about the UK's trade ties with China she said: "Our national security invariably come first."

Recent statement by China to strengthen export controls on critical minerals and other materials that are crucial for advanced tech production led US President Donald Trump to threaten an additional 100% tariff on goods from the Asian country, raising the prospect of an all-out commercial conflict between the two largest economies.

The American finance chief labeled the Chinese decision "commercial pressure" and "a international production control attempt."

Questioned on considering the US offer to participate in its dispute with the Asian nation, Reeves said she was "very concerned" by China's actions and encouraged the Chinese government "not to put up barriers and limit trade."

She said the action was "damaging for the global economy and causes additional headwinds."

"It is my opinion there are fields where we need to address Chinese policies, but there are also significant opportunities to trade with China's economy, including banking sector and other areas of the economy. We've got to achieve that balance correct."

The Treasury chief also stated she was collaborating with international partners "regarding our own critical minerals plan, so that we are reduced dependence."

NHS Drug Pricing and Investment

Reeves also acknowledged that the price the NHS pays for medicines could increase as a consequence of current negotiations with the Trump administration and its drugs companies, in exchange for reduced taxes and investment.

Some of the biggest global drug companies have said lately that they are either pausing or abandoning projects in the United Kingdom, with several attributing the modest returns they are receiving.

Last month, the government science advisor said the cost the NHS spends on drugs would have to increase to prevent businesses and pharmaceutical investment leaving the United Kingdom.

Reeves informed the BBC: "We have seen due to the cost structure, that clinical trials, recent pharmaceuticals have not been offered in the United Kingdom in the manner that they are in other EU nations."

"Our aim is to ensure that individuals getting treatment from the National Health Service are able to obtain the finest life-saving drugs in the globe. And so we are examining these issues, and... looking to secure more investment into the UK."