The Zions Bank Wasatch Front Consumer Price Index (CPI) increased 0.4 percent from December to January on a non-seasonally adjusted basis.
Year-over-year, the Wasatch Front Consumer Price Index has grown 3.3 percent, while the National Consumer Price index has increased 2.1 percent since January of last year.
Prices within the economy have remained relatively stable in recent months, a good sign for the Beehive State, which has registered inflation above 3 percent since May 2017. Inflation within the state has been largely driven by price increases in the housing, transportation and education sectors.
Rising housing prices have caused the majority of the year-over-year cost of living increases in January, as statewide housing demand continues to outweigh supply. According to a study published last year by the Kem C. Gardner Policy Institute, from 2010 to 2015, the total number of households within the state increased by 109,321 while the total number of housing units only increased by 81,656. The study also noted that for the first time in 40 years, households are growing at a faster pace than housing units. The Utah housing shortage has most likely been caused by Utah’s population growth as well as the state’s robust job market which has attracted thousands of highly-skilled laborers to the state.
“Utah’s business friendly public policy has led to significant job growth within the state,” said Scott Anderson, Zions Bank president and CEO. “As Utah businesses continue to expand, Utahns will continue to see labor wage growth, which will help to combat statewide cost of living increases.”
Although prices in most sectors of the economy remained relatively unchanged from December, Utah did witness slight price increases in the following sectors:
Transportation prices increased 2.0 percent as car insurance rates increased significantly in January
Utilities prices increased 0.8 percent in January as propane and fuel prices increased slightly
Price increases were largely offset by price decreases in the following sectors:
Medical care prices decreased 2.0 percent as prices for prescription drugs decreased slightly in January
Prices for other goods and services decreased 0.5 percent as hygiene product prices decreased slightly
“Economic growth within the housing sector is a result of Utah’s robust economy,” said Randy Shumway, chairman and partner at Cicero Group. “As housing demand has exceeded supply, we have seen price growth in the sector. Over the long term continued population and job growth will continue to drive residential construction which has an overall growth effect on the statewide economy.”
Analysis and data collection for the Zions Bank CPI and the Zions Bank Consumer Attitude Index are provided by Cicero Group, a premier market research firm based in Salt Lake City.