Gas, housing prices drive CPI up after minor decrease in December

After a minor decrease in December, the index of prices that Utah consumers pay took a significant jump in January. The Zions Bank Wasatch Front Consumer Price Index (CPI) rose 0.7 percent in January, bringing the annualized rate to 2.6 percent since this same time last year. Meanwhile, the national Consumer Price Index rose 0.6 percent from December to January and has grown 2.5 percent over the past year.

The month-over-month increase in Utah’s overall CPI was driven by higher prices for housing and transportation. These two categories account for a collective 54 percent of the average Utah consumer’s expenditures, resulting in a significant influence on the overall Utah CPI. Transportation prices increased 1.7 percent as prices for gasoline, vehicles and airfares rose. Housing prices increased 1.0 percent as hotel, motel and apartment rental rates rose.

“Homes in Utah continue demonstrate their value as investments,” said Scott Anderson, Zions Bank president and CEO. “As Utah continues to attract newcomers looking for a great place to live and access to a thriving job market, our economy benefits.”

The rise in Utah’s overall CPI was also driven by higher prices in the following categories:

• Prices for food at home increased 0.5 percent in January as tomatoes, pears and bell peppers led the way.

• Clothing prices increased 0.5 percent as prices for men’s and women’s apparel rose.

• Education and communication prices increased 0.4 percent as fees for some elementary and high schools increased.

• Price increases for some nonprescription drugs and medical supplies caused medical care prices to rise 0.2 percent.

Utah’s price increases were slightly offset by lower prices in the following sectors:

• Utilities prices decreased 1.2 percent, more than any other sector, as propane prices and rates for some garbage collection services declined.

• Recreation prices decreased 0.1 percent as some entertainment venues lowered ticket prices and as prices for pets and pet products declined.

“Gasoline prices in Utah rose more than 25 percent through 2016, driven by oil prices, which rose through most of the year,” said Randy Shumway, chairman at Cicero Group, a market research firm based in Salt Lake City that does the data collection and analysis for the CPI. “Although consumers may pay a little more at the pump, oil and gas prices are more sustainable than they were last year, giving a healthy lift to America’s energy industries.”