SALT LAKE CITY — Utah consumers are particularly optimistic about the current state of the local economy, a new survey indicates.
The Zions Bank Utah Consumer Attitude Index rose 5.9 points from 105.3 in July to 111.2 in August. In comparison, the national Consumer Confidence Index increased 10.5 points to 101.5.
"Utah is running on all cylinders economically," said Zions Bank economic adviser Randy Shumway, adding that an index of 110 or greater connotes a particularly robust economy.
Based on a representative sample of 500 Utah households surveyed by the Cicero Group, the index has a confidence interval of plus or minus 4.38 percent at a 95 percent confidence level. The latest data are compared to both Utah data and U.S. data from previous months to identify key consumer sentiment trends in the state.
Optimism pervaded two of the top sub-indicators as well, according to the survey. The Present Situation Index, which measures how consumers feel about current economic conditions, rose 3.9 points in August following an unexpected downturn in July, Shumway said. The Present Situation Index registered at 119.9 points, up from 116.0 last month.
Also, the Zions Bank Expectations Index climbed 7.1 points to 105.3, compared to the national Expectations Index, which jumped 10.2 points to 92.5. Expectations for the next six months increased after two months of declines, he said. The Expectations Index measures what consumers anticipate economic conditions will be six months from now.
Led by falling transportation costs, the Zions Bank Wasatch Front Consumer Price Index decreased 0.2 percent from June to July. The index has increased nearly 2 percent percent since this same time last year, which is in line with the Federal Reserve’s national inflation target, Shumway said.
While airfare decreased the most, vehicle maintenance and repair prices also declined from June to July. Gasoline prices climbed to their summer peak in June and have been steadily declining since, Shumway noted. That trend should continue into fall as the price of Brent crude oil hovers around $45 per barrel, he said.
This month marks the highest annual inflation along the Wasatch Front since May 2014, he said. The national Consumer Price Index remained flat from June to July and has increased 0.2 percent over the past 12 months, he added.
Shumway cautioned that the current volatility in China and other high-profile foreign markets will have some impact on the U.S., but chances are that effect will not be as dramatic as some might anticipate.
"In China, things are still going well (economically). Their stock market is still up over 15 percent year-over-year," he said. "Yes, the Chinese market is slowing, but it is still growing at 6.7 percent to 6.8 percent (annually). There is a lot of reason to still be optimistic about China."
With that in mind, he said these kind of market corrections are not uncommon, especially when economies are in sustained patterns of growth as China has been.
"There are a myriad of reasons to believe that China's economy is going to continue to crank along well above 6 percent in the coming years," Shumway said. "Generally speaking, there are many more reasons to be optimistic about both the China economy and the U.S. economy — but in particular the Utah economy."
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