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Treasury head Rachel Reeves has announced she is planning "focused action to deal with cost of living pressures" in the forthcoming Budget.

In comments to media outlets, she noted that curbing inflation is a shared duty of both the administration and the central bank.

The UK's inflation rate is projected to be the most elevated among the G7 advanced economies this calendar year and the following year.

Possible Utility Bill Measures

It is understood the administration could take action to bring down utility costs, for instance by reducing the present 5% rate of VAT charged on energy.

Another possibility is to lower some of the regulatory levies presently included in bills.

Budgetary Limitations and Expert Expectations

The administration will receive the next assessment from the independent fiscal watchdog, the OBR, on Monday, which will show how much scope there is for such measures.

The view from the majority of economists is that Reeves will have to announce higher taxes or budget cuts in order to fulfill her declared borrowing rules.

Previously on Thursday, estimates indicated there was a £22 billion deficit for the Treasury chief to address, which is at the lower end of expectations.

"It is a collective job between the central bank and the government to further reduce some of the causes of inflation," Reeves informed reporters in Washington, at the conferences of the IMF and global financial institution.

Tax Pledges and International Issues

While a great deal of the focus has been on expected tax rises, the chancellor said the most recent information from the OBR had not altered her pledge to campaign commitments not to raise rates on income tax, VAT or social security contributions.

She attributed an "uncertain global environment" with increasing geopolitical and trade issues for the fiscal revenue measures, likely to be targeted on those "wealthiest."

Global Economic Tensions

Referring to apprehensions about the UK's trade ties with China she said: "The UK's national security always come first."

Recent announcement by Chinese authorities to strengthen export controls on rare earths and other resources that are key for high-technology production led US President Donald Trump to suggest an further 100% import tax on goods from the Asian country, increasing the possibility of an all-out commercial conflict between the two economic giants.

The US Treasury Secretary labeled the Chinese action "commercial pressure" and "a global supply chain control attempt."

Questioned on accepting the US offer to join its battle with China, the Chancellor said she was "deeply worried" by Chinese measures and encouraged the Beijing authorities "not to put up barriers and restrict access."

She said the move was "damaging for the world economy and creates additional challenges."

"I believe there are fields where we should address China, but there are also significant chances to export to Chinese markets, including financial services and other sectors of the economy. We've got to achieve that equilibrium right."

The chancellor also affirmed she was collaborating with other major economies "regarding our own critical minerals strategy, so that we are more independent."

Health Service Medicine Pricing and Funding

The Chancellor also recognized that the price the NHS pays for pharmaceuticals could increase as a consequence of ongoing talks with the US government and its drugs companies, in return for reduced taxes and capital.

Some of the world's largest pharmaceutical manufacturers have said in recent statements that they are either delaying or abandoning projects in the UK, with several blaming the insufficient payments they are obtaining.

Last month, the government science advisor said the cost the NHS spends on medicines would need to increase to stop businesses and drug research funding departing from the UK.

The Chancellor told media: "It has been observed due to the cost structure, that medical research, innovative medicines have not been provided in the UK in the way that they are in other continental states."

"The objective is to ensure that individuals getting care from the National Health Service are can receive the finest critical drugs in the world. And so we are reviewing this situation, and... looking to secure additional funding into the UK."