"We have seen gasoline demand drop rather significantly over the course of the last several weeks since the hurricane, and if that impact continues — especially now that we're past the summer driving months — we should see gasoline prices trend back downward, possibly 20 cents to 30 cents per gallon over the next month or two," Jenson said.

The economy was expanding at a solid pace before Katrina hit and it is this momentum that Jenson and others believe will help keep the economy from being pushed into a full-fledged downturn.

"We suspect we're still in an environment where prices are pretty well contained," he said, pointing to still-low interest rates, mortgage and refinancing costs, and stable prices for consumer goods like clothing and cars.

However, there are some economists who worry that the effect of high energy prices may soon start to spill over into other areas as many businesses are forced to add on fuel surcharges to reflect higher delivery costs for their products.

Over the past 12 months, overall consumer prices have risen by 3.6 percent nationally, the biggest 12-month increase in inflation since a similar rise in the 12 months ending May 2001.

Clothing prices, which had been falling, rose a sharp 1 percent in July, but food prices continued to show moderation, edging up just 0.1 percent last month, reflecting price declines for beef, pork, fruits and vegetables.

Locally, prices were steady in August, except for a 0.1 percent increase in clothing costs and a 0.2 percent drop in grocery prices. And, Jenson said that Katrina's impact on consumer prices going forward — excluding fuel — should be minimal. Utah doesn't import a lot of food, textiles or other goods from the affected region, he said.

The Utah economy also isn't likely to be dramatically impacted by Delta Air Lines' bankruptcy filing Wednesday, Jenson said.

"Surely, for those who are employed by Delta, there is likely to be consternation," he said. "There are questions about whether they'll keep their jobs, what will happen to salaries, pensions and benefits. But, from what Delta has said, and by the way they've been building up operations here in Utah, it could be a net benefit for Utah. We don't know yet. In general, though, I'd say the impact to the average person in the valley will be minimal."