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Chancellor Reeves has revealed she is preparing "specific measures to address cost of living issues" in the upcoming financial statement.

In comments to media outlets, she noted that lowering price rises is a shared task of both the government and the Bank of England.

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

Possible Energy Bill Measures

It is understood the government could take action to lower energy bills, for instance by slashing the current 5% level of VAT applied on energy.

A further approach is to reduce some of the regulatory levies currently included in bills.

Budgetary Limitations and Expert Expectations

The administration will obtain the latest assessment from the official forecaster, the OBR, on the start of the week, which will reveal how much scope there is for these actions.

The expectation from the majority of analysts is that Reeves will have to introduce tax rises or budget cuts in order to meet her self-imposed borrowing rules.

Previously on Thursday, analysis showed there was a £22 billion gap for the chancellor to address, which is at the more modest range of expectations.

"There's a joint responsibility between the central bank and the administration to continue tackling some of the causes of price increases," the Chancellor told the BBC in the US capital, at the conferences of the IMF and global financial institution.

Tax Pledges and International Concerns

While a great deal of the attention has been on expected tax increases, the chancellor said the latest information from the fiscal watchdog had not altered her pledge to election pledges not to raise rates on income tax, sales tax or National Insurance.

She attributed an "unpredictable world" with increasing geopolitical and commercial tensions for the Budget revenue measures, likely to be directed on those "wealthiest."

International Trade Disputes

Commenting on concerns about the UK's commercial links with the Asian nation she said: "The UK's national security invariably are paramount."

Last week's announcement by China to tighten trade restrictions on critical minerals and other materials that are crucial for advanced tech manufacturing led American leader Donald Trump to threaten an further 100% tariff on goods from the Asian country, raising the prospect of an full-scale commercial conflict between the two largest economies.

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

Inquired about considering the US offer to participate in its dispute with China, the Chancellor said she was "extremely troubled" by China's measures and encouraged the Beijing authorities "to avoid restrictions and limit trade."

She said the decision was "damaging for the international commerce and generates additional challenges."

"It is my opinion there are sectors where we should challenge Chinese policies, but there are also significant prospects to sell into Chinese markets, including financial services and other sectors of the economy. We've got to achieve that balance correct."

The chancellor also affirmed she was collaborating with other major economies "on our own critical minerals approach, so that we are less reliant."

Health Service Drug Pricing and Investment

Reeves also admitted that the cost the NHS spends on medicines could rise as a result of current discussions with the US government and its pharmaceutical firms, in exchange for lower tariffs and funding.

A number of the world's largest drug companies have said recently that they are either halting or scrapping investments in the United Kingdom, with several attributing the low prices they are getting.

Last month, the government science advisor said the cost the NHS spends on drugs would must go up to stop companies and drug research funding leaving the United Kingdom.

The Chancellor told media: "We have seen because of the cost structure, that clinical trials, new drugs have not been available in the UK in the extent that they are in other continental states."

"Our aim is to ensure that individuals receiving care from the NHS are can access the finest critical drugs in the globe. And so we are examining this situation, and... seeking to attract increased investment into the UK."