Testing NextJS project with Jest - Jest is unable to find my babel config for transpilation

Question

I've tried to setup Jest in a couple of my Typescript NextJS projects, but because of my custom babel config it fails with the following error:

MacroError: The macro you imported from "undefined" is being executed outside the context of compilation with babel-plugin-macros. This indicates that you don't have the babel plugin "babel-plugin-macros" configured correctly. Please see the documentation for how to configure babel-plugin-macros properly: https://github.com/kentcdodds/babel-plugin-macros/blob/master/other/docs/user.md

I searched around and found that babel-jest is likely not reading my babel.config.js file. My babel config is shown below:

I've setup a starter repository with the problem at : https://github.com/manavda/nextjs-typescript-starter.

Thanks for reading and for your help