Experts predict Jersey's record high inflation to fall sharply by the end of the year, but the Treasury Minister says he is 'remaining cautious'.
The Bank of England has today (11 May) raised the interest rates a further 0.25 percentage points to 4.5%.
It's the 12th consecutive hike and a further blow to homeowners with mortgages as repayments will become more expensive.
But Jersey's economic experts believe that we are at the worst of the cost of living crisis, with both inflation and interest rates peaking.
The most recent measure of the rising cost of living has remained unchanged at 12.7%, the highest in the British Isles.
But by this December, it's thought the rate of inflation could return to single digits, at just under 6%.
However, Treasury Minister Deputy Ian Gorst says the government still has money set aside to intervene again if necessary.
"The independent economists said to us that if we are to make further interventions then they need to be targeted at the very lowest-earning households.
We still have some budget to help if we see inflation remaining high and being sticky."
Deputy Gorst's says once inflation is under control, then we can start feeling the benefits of economic growth.
"If the economy is growing, and therefore pay is rising based on that growth and not on inflation, then islanders can feel the benefit in their pocket.
It's also good for government wallets as well because it increases the tax take."
The Income Forecasting Group is expected to release its economic forecasts in the coming weeks.
New café bar and kitchen coming to Jersey Airport
Fresh process to choose Havre des Pas Lido operator
Plémont puffins get a Christmas makeover
Jersey Water has 100% compliance in all water quality standards, including PFAS
Large-scale Jersey drug dealer jailed
Jersey's politicians agree 2026 Budget
Three jailed for ‘unsophisticated’ drug smuggling syndicate
Island-first Christmas Tractor Run for Jersey Hospice Care
