JERSEY is beginning to feel the effects of the credit crunch – and things will get much worse if the UK goes into recession, the Chamber of Commerce has warned.

The chamber’s vice-president, Ray Shead, said that Islanders were already experiencing hard times and that if the UK went into recession, it might take six to nine months to hit Jersey. Mr Shead said: ‘Certainly it will have an effect.

We are already feeling it now. Life is tough on the high street. Companies are starting their sales early.‘I think on the financial side of things that the Retail Prices Index figures show an increase in food prices, added of course to the GST.

There will also be an effect on people who are coming out of fixed-rate mortgages.’Mr Shead, who is also chairman of the chamber’s retail and supply committee, said that people’s disposable incomes were being squeezed, which was a sign that we could already be feeling the effects of a recession on a small scale.