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Chancellor Rachel Reeves has stated she is preparing "focused action to tackle cost of living challenges" in the forthcoming financial statement.

In comments to media outlets, she emphasized that reducing price rises is a joint responsibility of both the administration and the Bank of England.

The UK's inflation rate is projected to be the most elevated among the G7 industrialized countries this calendar year and next.

Possible Energy Cost Interventions

It is understood the government could intervene to lower energy bills, for example by slashing the present 5% level of value-added tax applied on energy supplies.

Another approach is to lower some of the government charges currently included in household expenses.

Budgetary Limitations and Expert Predictions

The administration will receive the next draft from the independent fiscal watchdog, the Office for Budget Responsibility, on Monday, which will show how much scope there is for such actions.

The consensus from most economists is that Reeves will have to announce tax rises or spending cuts in order to meet her declared borrowing rules.

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

"It is a joint task between the central bank and the administration to further reduce some of the drivers of price increases," Reeves informed the BBC in the US capital, at the annual meetings of the IMF and global financial institution.

Tax Pledges and Global Issues

While a great deal of the focus has been on probable tax rises, the chancellor said the latest figures from the fiscal watchdog had not changed her commitment to campaign commitments not to raise rates on income tax, sales tax or social security contributions.

She blamed an "unpredictable global environment" with growing international and commercial issues for the fiscal revenue measures, probably to be directed on those "with the broadest shoulders."

Global Trade Tensions

Referring to worries about the UK's commercial links with the Asian nation she said: "The UK's security interests always take priority."

Recent announcement by Chinese authorities to tighten trade restrictions on rare earths and other materials that are essential for high-technology production led US President the US President to threaten an further 100% tariff on goods from the Asian country, increasing the possibility of an all-out trade war between the two economic giants.

The US Treasury Secretary described the Chinese action "economic coercion" and "a international production power grab."

Inquired about accepting the US offer to participate in its dispute with China, the Chancellor said she was "very concerned" by Chinese measures and called on the Chinese government "not to put up barriers and limit trade."

She said the move was "bad for the world economy and generates further obstacles."

"I believe there are sectors where we should address Chinese policies, but there are also significant chances to sell into China's economy, including financial services and other sectors of the economy. We've got to maintain that balance right."

The Treasury chief also stated she was cooperating with international partners "regarding our own essential resources plan, so that we are more independent."

Health Service Drug Costs and Funding

Reeves also admitted that the price the National Health Service spends on drugs could rise as a consequence of current negotiations with the Trump administration and its drugs companies, in return for lower tariffs and investment.

Some of the world's largest pharmaceutical manufacturers have said recently that they are either delaying or canceling projects in the UK, with some attributing the low prices they are receiving.

Last month, the Science Minister said the cost the NHS pays for drugs would must rise to prevent companies and drug research funding departing from the UK.

The Chancellor told the BBC: "It has been observed as a result of the cost structure, that medical research, new drugs have not been provided in the UK in the manner that they are in other continental states."

"The objective is to make sure that patients getting care from the NHS are able to obtain the best essential drugs in the globe. And so we are reviewing this situation, and... seeking to attract more funding into Britain."