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Chancellor Reeves has revealed she is planning "targeted action to address cost of living issues" in next month's Budget.

During an interview with media outlets, she emphasized that reducing price rises is a collective duty of both the administration and the central bank.

The UK's price growth is expected to be the highest among the G7 developed nations this calendar year and next.

Possible Energy Bill Measures

It is understood the government could intervene to reduce energy bills, such as by slashing the current 5% level of VAT charged on energy.

Another approach is to cut some of the regulatory levies currently added to bills.

Fiscal Limitations and Analyst Predictions

The government will obtain the latest assessment from the official forecaster, the OBR, on Monday, which will clarify how much scope there is for such actions.

The expectation from the majority of economists is that the Chancellor will have to introduce tax increases or budget cuts in order to fulfill her self-imposed borrowing rules.

Previously on the same day, analysis indicated there was a £22bn deficit for the chancellor to fill, which is at the lower end of projections.

"There's a joint job between the Bank of England and the administration to continue tackling some of the causes of inflation," Reeves stated to reporters in Washington, at the annual meetings of the IMF and World Bank.

Tax Pledges and Global Concerns

While much of the focus has been on likely tax increases, the chancellor said the latest data from the OBR had not altered her commitment to election pledges not to increase tax levels on earnings tax, VAT or social security contributions.

She attributed an "uncertain global environment" with increasing geopolitical and trade tensions for the Budget revenue measures, probably to be focused on those "most able to pay."

International Trade Disputes

Addressing concerns about the United Kingdom's economic relations with the Asian nation she said: "Our national security always are paramount."

Last week's 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 propose an further 100% import tax on goods from the Asian country, raising the risk of an all-out commercial conflict between the two economic giants.

The US Treasury Secretary labeled the Chinese action "commercial pressure" and "a international production control attempt."

Inquired about considering the American proposal to join its battle with the Asian nation, Reeves said she was "very concerned" by Chinese actions and encouraged the Beijing authorities "to avoid restrictions and limit trade."

She said the action was "bad for the global economy and generates further obstacles."

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

The Treasury chief also affirmed she was cooperating with other major economies "regarding our own essential resources plan, so that we are less reliant."

NHS Medicine Costs and Investment

The Chancellor also admitted that the price the NHS spends on medicines could increase as a result of current discussions with the Trump administration and its drugs companies, in exchange for lower tariffs and investment.

Some of the world's largest pharmaceutical manufacturers have said recently that they are either pausing or abandoning investments in the UK, with several blaming the low prices they are obtaining.

Last month, the government science advisor said the price the health service pays for drugs would have to go up to prevent firms and pharmaceutical investment departing from the United Kingdom.

Reeves told the BBC: "It has been observed because of the cost structure, that drug testing, new drugs have not been provided in the United Kingdom in the manner that they are in other European countries."

"The objective is to guarantee that patients receiving treatment from the NHS are can receive the best essential drugs in the globe. And so we are looking at these issues, and... looking to secure more capital into the UK."