Utah cost of living up 0.7%

Transportation prices pulled the cost of living higher in Utah and around the country last month, according to reports released Wednesday.

And while gas prices are expected to fall in coming weeks, the pressure on prices may continue as concern builds over the nation's mounting trade deficit.

Wells Fargo Bank reported Wednesday that prices along the Wasatch Front increased 0.7 percent in October. Transportation costs led the way, spiking 3.4 percent higher than September prices. Grocery costs also edged higher, which Wells attributed in part to higher fruit and produce prices following the hurricanes that struck Florida and the Gulf Coast in August and September.

Aside from a 0.1 percent increase in clothing prices, all other price categories remained steady, according to the Wells Fargo report.

"We see a lot of this being somewhat temporary in nature and reversible," said Sterling Jenson, senior managing director of Wells Capital Management in Salt Lake City.

Crude oil prices, which peaked earlier this month at $55 per barrel, were closer to $46 per barrel Wednesday, Jenson said. That should translate into lower prices at the gas pumps in the next few weeks.

Nationwide, prices rose 0.6 percent in October, the most since May, according to a U.S. Labor Department report released Wednesday. Consumer prices for all goods and services were up 3.2 percent for the 12 months that ended in October, compared with a 3 percent year-over-year gain the previous month. Core prices were 2 percent higher over that period, the same as in September.

"We have a solid economy and slowly rising inflation," said Joel Naroff, president of Naroff Economic Advisors in Holland, Pa. "This only reinforces the belief that the Fed will tighten a lot more."

Other economic news added to the case for another rate increase by the Fed:

• Industrial production shot up 0.7 percent in October, following a 0.1 percent increase in September, the Federal Reserve reported.

• Housing construction jumped 6.4 percent last month to a seasonally adjusted annual rate of 2.03 million units — the highest level of this year, the Commerce Department said.