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Chancellor Rachel Reeves has stated she is preparing "specific measures to deal with cost of living issues" in next month's financial statement.

During an interview with the BBC, she emphasized that lowering inflation is a collective task of both the government and the Bank of England.

The United Kingdom's inflation rate is expected to be the highest among the G7 industrialized countries this year and next.

Possible Utility Cost Measures

Sources suggest the administration could take action to lower energy bills, for example by slashing the present 5% rate of VAT charged on energy.

An additional possibility is to lower some of the government charges currently added to bills.

Fiscal Limitations and Analyst Predictions

The administration will receive the latest report from the independent fiscal watchdog, the Office for Budget Responsibility, on the start of the week, which will clarify how much room there is for such measures.

The expectation from the majority of experts is that the Chancellor will have to announce tax rises or spending cuts in order to adhere to her voluntary borrowing rules.

Previously on Thursday, calculations showed there was a twenty-two billion pound gap for the Treasury chief to resolve, which is at the lower end of projections.

"It is a shared task between the Bank of England and the administration to bear down further on some of the sources of inflation," the Chancellor informed the BBC in Washington, at the yearly gatherings of the IMF and World Bank.

Tax Commitments and Global Issues

While much of the focus has been on likely tax increases, the chancellor said the most recent data from the OBR had not changed her commitment to election pledges not to increase rates on income tax, sales tax or National Insurance.

She attributed an "unpredictable global environment" with rising international and commercial issues for the fiscal revenue measures, probably to be directed on those "most able to pay."

Global Trade Tensions

Commenting on concerns about the United Kingdom's trade ties with China she said: "The UK's national security invariably come first."

Last week's announcement by Chinese authorities to increase trade restrictions on critical minerals and other materials that are essential for high-technology manufacturing led US President Donald Trump to propose an further 100% tariff on goods from the Asian country, raising the risk of an all-out trade war between the two economic giants.

The US Treasury Secretary called the Chinese action "economic coercion" and "a global supply chain control attempt."

Questioned on accepting the US offer to participate in its battle with China, the Chancellor said she was "extremely troubled" by Chinese actions and encouraged the Chinese government "to avoid restrictions and restrict access."

She said the move was "damaging for the world economy and causes further headwinds."

"I believe there are fields where we must confront China, but there are also significant opportunities to sell into China's economy, including financial services and other areas of the economy. We've got to get that equilibrium appropriate."

The chancellor also stated she was working with international partners "on our own essential resources plan, so that we are more independent."

NHS Drug Costs and Investment

Reeves also admitted that the price the NHS pays for drugs could rise as a result of current talks with the Trump administration and its drugs companies, in return for lower tariffs and capital.

A number of the biggest global drug companies have said lately that they are either delaying or scrapping investments in the UK, with some attributing the low prices they are obtaining.

Recently, the Science Minister said the price the health service pays for medicines would have to rise to halt firms and pharmaceutical investment departing from the UK.

Reeves told the BBC: "It has been observed as a result of the cost structure, that drug testing, innovative medicines have not been offered in the UK in the extent that they are in other European countries."

"We want to ensure that patients getting treatment from the NHS are able to receive the top life-saving medicines in the globe. And so we are looking at these issues, and... looking to obtain increased capital into the UK."