Prices up – but no pay rises, please...

ISLANDERS are being warned to expect a tough 12 months with forecasts that the cost of living could rise dramatically this year.

Jersey economists have predicted that the recent GST rise, coupled with a rise in global food and production costs and the strong possibility that interest rates will go up could push inflation to five per cent.

The economists are now urging Islanders and businesses not to make the situation worse by agreeing large pay increases, which could push prices up further.

However, Economic adviser Dougie Peedle, who helped produce the forecast, said that although there would be some pressure on Islanders in the short-term, the overall outlook was more positive.(from JEP)