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Chancellor Rachel Reeves has announced she is preparing "specific steps to address cost of living challenges" in next month's Budget.

During an interview with the BBC, she stated that lowering price rises is a shared responsibility of both the administration and the Bank of England.

The UK's price growth is expected to be the most elevated among the Group of Seven industrialized countries this calendar year and the following year.

Possible Utility Bill Measures

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

A further possibility is to reduce some of the government charges currently included in household expenses.

Budgetary Limitations and Expert Expectations

The government will obtain the next draft from the official forecaster, the OBR, on the start of the week, which will clarify how much space there is for these actions.

The expectation from most experts is that the Chancellor will have to announce higher taxes or expenditure reductions in order to adhere to her declared debt limits.

Earlier on the same day, estimates indicated there was a £22bn deficit for the Treasury chief to resolve, which is at the lower end of projections.

"It is a collective task between the Bank of England and the administration to further reduce some of the sources of inflation," the Chancellor told reporters in the US capital, at the yearly gatherings of the International Monetary Fund and World Bank.

Revenue Commitments and Global Concerns

While much of the focus has been on expected tax increases, the Treasury chief said the latest data from the fiscal watchdog had not changed her commitment to campaign commitments not to increase tax levels on earnings tax, sales tax or social security contributions.

She attributed an "uncertain world" with growing geopolitical and commercial tensions for the Budget revenue measures, probably to be targeted on those "with the broadest shoulders."

Global Economic Tensions

Addressing worries about the United Kingdom's economic relations with China she said: "The UK's security interests always come first."

Recent announcement by China to increase trade restrictions on rare earths and other materials that are essential for advanced tech manufacturing led US President the US President to threaten an additional 100% import tax on imports from China, increasing the possibility of an all-out commercial conflict between the two global powers.

The American finance chief labeled the Chinese move "commercial pressure" and "a international production power grab."

Questioned on considering the US offer to participate in its conflict with China, the Chancellor said she was "deeply worried" by China's measures and encouraged the Beijing authorities "not to put up barriers and restrict access."

She said the action was "damaging for the world economy and creates additional obstacles."

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

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

NHS Medicine Pricing and Investment

Reeves also acknowledged that the price the NHS pays for drugs could increase as a result of current negotiations with the US government and its pharmaceutical firms, in exchange for reduced taxes and capital.

A number of the world's largest drug companies have said recently that they are either delaying or canceling projects in the United Kingdom, with several blaming the insufficient payments they are getting.

Last month, the Science Minister said the cost the health service pays for medicines would need to increase to prevent companies and pharmaceutical investment departing from the UK.

The Chancellor told the BBC: "We have seen because of the cost structure, that drug testing, recent pharmaceuticals have not been provided in the UK in the way that they are in other continental states."

"The objective is to make sure that individuals receiving treatment from the National Health Service are can obtain the top critical medicines in the world. And so we are examining all of that, and... seeking to attract increased investment into Britain."