Rise and fall of the cost of living in Jersey brings down inflation

Monday 19 January 2015

A fall in the cost of shoes, bread, heating oil and cheese has contributed to a lower inflation rate in the last quarter of 2014.

The latest Retail Price (RPI) Index published last week by the States Statistics Unit showed a fall of 0.6% in the 2014 rate from 1.9% in September to 1.3% at the year’s end.

The Retail Prices Index (RPI) is the main measure of inflation in Jersey. It measures the change from quarter to quarter in the price of the goods and services purchased by an “average household”.

The Statistics Unit attributes the price fall in a number of traditional “shopping basket” items such as shoes, clothes, food and household products and domestic heating fuel.

The cost of basic food items - including meat, cheese and bread - was an average 0.5% cheaper in the run up to Christmas. However, indulging in the classic comfort foods of biscuits and cakes went up.

Healthy eating took a blow as it cost more to get your recommended “five a day” as fresh fruit prices went up – though this was offset by a reduction in the cost of indulging in some “R and R” as the price of leisure goods and services and travel fares fell.

While, the rate for underlying inflation RPI(Y) – excluding mortgage interests payments and indirect taxes such as GST and impôts - rose by 1.3% and the RPI(X) – which excludes interest on mortgages – went up 1.5%, these were the lowest rates in a year.

The RPI annual rates for pensioners and low-income earners also fell to the lowest recorded levels since they were introduced in 2007.

Although Islanders had to pay more for gas and electricity, these increases were offset by a fall in the price of domestic heating oil of 14p a litre.

In addition to the above categories, the Statistics Unit also monitors catering, alcoholic drinks, tobacco, motoring and housing. Collectively these categories comprise more than 500 representative goods and services available in the Island, which are used to compile the RPI.