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Prices edge up 0.5% in Utah

Increase is along Wasatch Front; indicator drops 0.2% nationwide

The consumer price index along the Wasatch Front went up a half percent in July, while nationally the indicator dropped 0.2 percent (0.4 seasonally adjusted), according to data from Wells Fargo and the U.S. Bureau of Labor Statistics that was released Friday.

The local index noted price increases in the cost of groceries, food at restaurants, housing, utilities, clothing, transportation and medical care. Recreation, education and communication and other goods and services all saw decreases.

Wells Fargo economist and vice president Kelly K. Matthews singled out increases in medical care costs and transportation as being largely responsible for the overall Wasatch Front price increase. Transportation costs didn't rise because of gasoline prices, which dropped recently, but due to a "sharp increase" in the price of new cars. That drove transportation costs up 1.7 percent from June. The 3.3 percent increase in medical care costs was attributed to rising prices of nonprescription drugs.

Matthews offered observations on interpreting the numbers, adding that inflation, for instance, is not always a bad thing. If prices were driven up by a strong economy or by consumer demand, it would be "desirous rather than sad."

He also pointed out that price increases for groceries don't mean Utahns pay more than elsewhere. It shows simply that the prices on the Wasatch Front have been increasing more rapidly here than nationally. Rising prices can be caused by increased demand or by an increased cost to produce something.

"I do not have a great explanation why groceries may be going up two times as fast as national numbers," he said, adding Utah's levels of food prices "may not be out of line; they may even be lower."

Overall, local grocery food prices are 8.2 percent higher than they were for the same period in 2008, while nationally those prices rose only 2 percent in a year-over-year comparison. The national rate compared six months, while the local index had only five months for comparison.

The 0.4 percent increase in the price of groceries was driven in part by a 4 percent uptick in the cost of produce, particularly citrus fruits and green peppers. Meat, poultry, fish and eggs decreased 3.6 percent.

Housing costs increased 0.2 percent as rental rates went up slightly, while utilities dropped 0.1 percent on decreased price of water.

Hygiene products, laundry and dry cleaning services and computers also saw their prices drop, as did those of cable and Internet service.

e-mail: Lois@desnews.com