BUSINESS + ECONOMY

In Utah, inflation continues to cool down

Jul 13, 2023, 1:01 PM

people at a grocery store, inflation has slightly cool...

People shop at a grocery store in Buffalo Grove, Ill., Sunday, March 19, 2023. Consumer prices in the United States cooled last month, rising just 0.1% from April to May and extending the past year's steady easing of inflation. (AP Photo/Nam Y. Huh)
Credit: ASSOCIATED PRESS

(AP Photo/Nam Y. Huh)

SALT LAKE CITY — In June, U.S. annual inflation slowed to 3%, according to the latest Consumer Price Index released Wednesday by the Bureau of Labor Statistics. In June of last year, surging energy costs helped spike inflation to 9.1% — the fastest annual rate since November 1981, according to CNN.

 

Inflation, as measured by the CPI, has now eased for 12 consecutive months and is at its lowest rate since March 2021.

The good economic news elevated the S&P 500 and the Nasdaq to close at their highest levels since April 2022 as reported by CNBC.

The CPI survey for June noted that housing was the largest contributing factor at more than 70%. Food and energy rose 0.2% in June, the smallest monthly increase since August 2021.

Robert Spendlove, senior vice president and economic and public policy officer at Zions Bank, told Dave and Dujanovic that the June inflation rate in Utah was about 4%.

Spendlove said the Federal Reserve has indicated it will raise interest rates at least one more time. The Fed will meet next on July 25-26.

“But then if we continue to see this inflation softening, the Fed will be able to pull back,” Spendlove said. “The areas that the Fed is worried about, though, is not goods inflation, but services inflation, where we’re still seeing that running too hot.”

“Haircuts are up 5%. Laundry services, up 5 [%]. Car repairs are up 12%. And so it’s that services sector that the Fed is like, ‘We’ve got to get that down before we can say we’ve accomplished our objective,’ ” Spendlove said.

He added prices for used cars are coming down because interest rates near 7% are driving down demand for new cars.

Read more: Back-to-school spending is forecast to drop 10% as inflation bites

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In Utah, inflation continues to cool down