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Chancellor Reeves has revealed she is preparing "targeted steps to address cost of living challenges" in the upcoming Budget.

Speaking to the BBC, she noted that curbing price rises is a joint responsibility of both the government and the central bank.

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

Potential Utility Bill Measures

It is understood the government could take action to bring down energy bills, for example by slashing the present 5% level of value-added tax charged on energy supplies.

Another option is to lower some of the policy costs presently added to bills.

Fiscal Limitations and Expert Predictions

The government will obtain the latest assessment from the independent fiscal watchdog, the OBR, on Monday, which will reveal how much room there is for such measures.

The consensus from most economists is that the Chancellor will have to declare higher taxes or budget cuts in order to fulfill her voluntary borrowing rules.

Previously on the same day, estimates indicated there was a twenty-two billion pound shortfall for the chancellor to fill, which is at the more modest range of projections.

"There's a shared responsibility between the Bank of England and the government to bear down further on some of the sources of inflation," the Chancellor told the BBC in Washington, at the annual meetings of the International Monetary Fund and World Bank.

Tax Pledges and International Issues

While a great deal of the focus has been on probable tax increases, the Treasury chief said the most recent figures from the OBR had not changed her pledge to election pledges not to raise rates on earnings tax, VAT or National Insurance.

She attributed an "unpredictable world" with rising geopolitical and trade concerns for the fiscal tax moves, likely to be targeted on those "wealthiest."

International Economic Tensions

Referring to concerns about the United Kingdom's commercial links with the Asian nation she said: "Our security interests invariably come first."

Recent statement by Chinese authorities to increase trade restrictions on rare earths and other materials that are crucial for advanced tech manufacturing led American leader Donald Trump to propose an further 100% tariff on imports from China, increasing the possibility of an all-out trade war between the two global powers.

The American finance chief called the Chinese decision "economic coercion" and "a international production power grab."

Asked about considering the American proposal to participate in its conflict with China, the Chancellor said she was "very concerned" by China's measures and called on the Beijing authorities "to avoid restrictions and limit trade."

She said the decision was "bad for the global economy and generates further headwinds."

"In my view there are sectors where we need to confront Chinese policies, but there are also significant prospects to sell into China's economy, including banking sector and other areas of the economic system. We've got to achieve that balance appropriate."

The Treasury chief also confirmed she was cooperating with international partners "on our own critical minerals strategy, so that we are less reliant."

NHS Medicine Pricing and Funding

Reeves also admitted that the price the NHS spends on medicines could increase as a result of ongoing talks with the US government and its drugs companies, in exchange for lower tariffs and investment.

Some of the biggest global drug companies have said recently that they are either halting or scrapping investments in the United Kingdom, with some blaming the insufficient payments they are receiving.

Recently, the Science Minister said the cost the health service pays for medicines would need to rise to stop businesses and pharmaceutical investment departing from the United Kingdom.

Reeves informed the BBC: "We have seen due to the cost structure, that clinical trials, innovative medicines have not been provided in the UK in the extent that they are in other continental states."

"The objective is to guarantee that people getting treatment from the NHS are can access the best critical drugs in the world. And so we are looking at all of that, and... seeking to secure increased investment into Britain."