SALT LAKE CITY — Consumer confidence in the Utah economy is growing.
The Zions Bank Consumer Attitude Index rose to its highest level since its inception in January 2011. The index now sits at 87.1 — up 2.1 points from September to October.
For consumers, the continued momentum in the housing and labor markets is outweighing the uncertainty of the election and anxiety about global growth, said Randy Shumway, chief executive officer of the Cicero Group.
Consumer confidence among Utahns has rebounded significantly since October 2011, increasing 19 points over that time, Shumway said.
Due to Hurricane Sandy, the Conference Board postponed its regularly scheduled Oct. 30 release of the national Consumer Confidence Index until Nov. 1.
The Zions Bank Present Situation Index — an assessment of confidence in current business and employment conditions — fell slightly by 3.5 points to 65.8. Utah consumers were less positive about the current business conditions in their area, which drove down the Present Situation score, Shumway added.
Sentiments toward the current employment situation remained unchanged from September to October.
Meanwhile, the Zions Bank Expectations Index — an estimate of consumer confidence in the economy six months from now — rose 5.8 points to 101.4. Consumers were slightly less optimistic about future job and income prospects, but Utahns were substantially more enthusiastic about their expectations for general business conditions, Shumway said.
"People are feeling much more confident about what the economy holds over the next six months than they ever have been before," he said.
Consumer attitudes toward the future of home prices reflect the housing sector recovery, Shumway noted.
"Our housing prices are growing at the fourth fastest rate in the country," he said.
More than 46 percent of Utahns say they think the value of homes like theirs will increase over the next 12 months, compared with only 26 percent last October, the report stated.
The Zions Bank Wasatch Front Consumer Price Index increased slightly from August to September — up 0.7 percent. The Wasatch Front index rose 3.9 percent over the past 12 months, outpacing the national CPI, which has risen 2 percent for the one-year period.
Higher gasoline and housing prices bumped the national seasonally adjusted CPI up 0.4 percent from August to September.
Historically, fuel prices have peaked in the summer and steadily declined throughout the fall, Shumway said. However, two explanations of the unusual trend were low levels of supply due to geopolitical unrest in the Middle East and unanticipated closures at some domestic refineries, he said.
"Average gasoline prices across the state increased by more than 25 cents from August to September," Shumway said. "Additionally, the price of flights from Salt Lake International Airport spiked for the first time in five months."
The combination drove local transportation prices up 2.5 percent, accounting for more than 60 percent of September's inflation, he explained.
Fuel prices could begin to decline as soon as November and December, Shumway said, as market forces begin to stabilize following the impending presidential election.
"Whoever gets elected, it will offer a degree of stability because we know what to expect for the next two to four years," he said.
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