The Zions Bank Wasatch Front Consumer Price Index decreased 0.3 percent from July to August on a non-seasonally adjusted basis.
The index has increased 1.4 percent since this same time last year, which remains below the Federal Reserve’s national inflation target of 2 percent. The national Consumer Price Index decreased 0.1 percent from July to August and has increased 0.2 percent over the past twelve months.
Transportation and medical prices had the largest downward impact on the overall CPI in August, both declining 1.8 percent. The cost of vehicle rentals dropped the most from July to August, followed by gasoline prices. While gasoline prices dropped about 5 percent in August, gasoline prices in Utah are still higher than the national average of $2.31 per gallon, sitting at $2.77 per gallon on a state level. Gasoline price declines in Utah have leveled out over the past month while national prices have continued to drop steadily. Crude oil futures, which contribute to gasoline prices, have been more volatile in August and September, despite steady declines from early May to late August. Airfare prices also declined in August, contributing to the overall transportation price drop. While vehicle maintenance and vehicle prices edged upward, their positive effect on the CPI was minimal.
Medical care prices dropped largely due to lower prices for medical care services, accompanied by a drop in the prices for eyeglasses and eye care. Prices for nonprescription drugs and medical supplies dropped slightly as well. While prices for prescription drugs and hospital and related services increased slightly, their effect was marginal.
Food away from home had the largest positive impact on the CPI this month, increasing 1.0 percent. Higher-priced full service meals at restaurants and higher prices for alcoholic beverages drove the increase. Fast food and snack prices declined slightly, but not enough to level out the price increase. Other goods and services —which include smoking and tobacco prices, personal care products, and funeral prices — increased 0.6 percent from last month. The increase was the result of higher prices for hygiene products, haircuts, and laundry and dry cleaning. Housing prices also increased slightly, edging up 0.4 percent from July to August due to higher prices for apartments and furniture. Bedding and appliance prices dipped, while hotel and motel prices remained flat. Utilities increased a mere 0.1 percent as propane prices rose in August.
Food at home prices remained flat from July to August. While several items—including in-season fruits like tomatoes, apples, and pears—decreased in price, meat, eggs, cucumbers, and citrus fruits increased in price, netting zero percent growth overall. Similar price trends were reported nationally as U.S. producer prices remained unchanged in August. The U.S. producer price index tracks prices charged by manufacturers, farmers, and other producers before they reach the consumer.
Clothing, recreation, and education and communication prices also all decreased in August. Clothing decreased 0.4 percent as men’s and women’s apparel dropped in price. Recreation prices dropped 0.7 percent due to lower prices for pets and pet products. Education and communication prices dropped 0.6 percent heading into the new school year as some schools decreased fees.
“With food prices holding steady and transportation prices dipping slightly, consumers are in a good spot,” said Scott Anderson, Zions Bank President and CEO. “Increased disposable cash allows consumers to be more confident in their purchases while simultaneously contributing to economic growth along the Wasatch Front.”
Analysis and data collection for the Zions Bank CPI and the Zions Bank Consumer Attitude Index are provided by the Cicero Group. The Cicero Group is a premier market research firm based in Salt Lake City.