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Utahns continue to have confidence in economy, despite higher gas prices

The Zions Bank Utah Consumer Attitude Index increased 0.4 points to register at 111.8 in June. The index currently sits 13.6 points higher than at the same time twelve months ago.
The Zions Bank Utah Consumer Attitude Index increased 0.4 points to register at 111.8 in June. The index currently sits 13.6 points higher than at the same time twelve months ago.
Jeffrey D. Allred, Deseret News

SALT LAKE CITY — Consumer belief in the Utah economy is as hot as the weather, a new report shows.

The Zions Bank Utah Consumer Attitude Index increased 0.4 points to register at 111.8 in June. The index currently sits 13.6 points higher than at the same time one year ago.

In contrast, the national Consumer Confidence Index increased 6.8 points from May to June to register at 101.4 for the monthly period.

Meanwhile, the Present Situation Index — a measure of how consumers feel about current economic conditions — continued its record-breaking climb to register at 120.9 points, up 2.7 points from May and nearly 19 points higher than the same period one year ago.

The Present Situation Index is based on consumers’ attitudes about current business conditions and job availability, said Zions Bank economic adviser Randy Shumway.

He noted, however, that expectations for the future are slightly less optimistic than last month. The Expectations Index — a measure of what consumers anticipate economic conditions six months from now will look like — declined 1.2 points from May to June to register at 105.8, but still up 10 points over its level a year ago.

The biggest drop in expectations related to perceptions of household income growth, Shumway said.

“We want the expectations index to be higher than the present situation index because you always want (consumers) to believe that tomorrow is going to be better than today,” he said. “What we’re seeing right now is that people are feeling pretty good about their current circumstances, but they wonder if this good (economic) streak can continue.”

The Utah Consumer Attitude Index is based on a representative sample of 500 Utah households. The monthly survey is conducted by the Cicero Group and has a confidence interval of plus or minus 4.4 percent at a 95 percent confidence level. The data collected is compared with both local and U.S. data from previous months to identify key consumer sentiment trends in the state.

Shumway noted that only 31 percent of consumers surveyed expect their household income to be higher in six months than it is today, compared to 35 percent last month. The majority of consumers — 63 percent — expect their household income to remain the same, he said.

Regarding the relatively high cost of driving currently in Utah, he said that gasoline prices continue to increase, albeit slowly compared to growth rates earlier this year. Gas prices typically increase in the summer months, so current price increases mirror historical trends.

The average price of gasoline in Utah is currently $3 per gallon, which is 23 cents higher than the current national average of $2.77 per gallon.

Despite the high fuel prices and the contradiction about expectations, Shumway said there is still good reason to feel upbeat about the local economic prospects going forward.

“The fundamentals are in place that the steady economic recovery is going to continue for the foreseeable future,” he said.

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