Total Inflation for 2011 Hits 2.8 Percent
SALT LAKE CITY, Utah; January 19, 2012 — In December 2011, on a non-seasonally adjusted basis, the Zions Bank Wasatch Front Consumer Price Index (CPI) decreased 0.5 percent.
The national consumer price index, which is an aggregation of all prices throughout the U.S., decreased 0.3 percent on a non-seasonally adjusted basis. Total inflation along the Wasatch Front for the 2011 year was 2.8 percent, which is within the Federal Reserve’s optimal inflation rate of two to three percent.
In November, prices along the Wasatch Front decreased for the first time in four months. During December, local prices continued to fall, dropping half a percent, which was the largest single month decrease in 2011.
December’s drop in inflation was primarily driven by falling fuel prices in the state. The average price of regular gasoline in Utah fell from $3.40 in November to $3.10 in December. As reported in the AAA Daily Fuel Gauge, Utah ranks first in having the cheapest gas in the nation. As a result, transportation costs decreased 3.1 percent last month, the largest single month decrease in 2011. For the year, transportation costs have increased 4.1 percent, which is largely the result of high crude oil prices in the beginning of last year. Falling vehicle, gasoline, and airfare costs have helped push overall transportation prices down in recent months.
Housing prices along the Wasatch Front, which account for approximately 35 percent of a Utahns’ income, decreased 0.1 percent last month. A price decrease in hotels and motels, as well as household appliances, were the primary cause of last month’s decrease. December marks the second consecutive month of falling housing costs, totaling a 0.3 percent drop since November. However, year-over-year, housing prices have increased 2.3 percent, which is slightly ahead of the national average of 1.9 percent.
Recreation price, which include electronics, sporting goods, club fees, and pet products, decreased 0.8 percent last month. Since November, recreation prices have decreased 1.0 percent. Facilitating December’s price decrease was a fall in pet food and products. Year-over-year, recreation costs have increased 1.5 percent.
Medical care costs, which account for approximately 6.5 percent of the average Utahns’ income, decreased 0.5 percent last month as medical services fell in price. Year-over-year, medical care prices have increased 1.7 percent, which is 1.8 percentage points below the national medical care inflation rate of 3.5 percent.
“The Zions Bank Wasatch Front CPI showed signs of further easing in December, which has been primarily driven by fuel prices,” said Zions Bank President and CEO Scott Anderson. “In the last 12 months, we have seen a 2.8 percent inflation rate, which is in line with the national average. Much of last year’s inflation was driven by higher gasoline prices, as national fuel prices begin to rise, Zions Bank will monitor the situation closely to bring consumers and businesses the most up-to-date news and trends.”
Analysis and data collection for the Zions Bank CPI and the Utah Consumer Attitude Index, to be released January 31, are provided by the Cicero Group/Dan Jones & Associates, a premier market research firm based in Salt Lake City.
Zions Bank is Utah’s oldest financial institution and is the only local bank with a statewide distribution of financial centers, Zions Bank operates locations in communities throughout Utah and Idaho. In addition to offering a wide range of traditional banking services, Zions Bank is also a leader in small business lending and has ranked as the No. 1 lender of U.S. Small Business Administration 7(a) loans in Utah for the past 18 consecutive years. Founded in 1873, Zions Bank has been serving the communities of Utah for more than 135 years. Additional information is available at www.zionsbank.com.