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11/19/09

Utah cost of living dips

The Utah economy continues to weaken, but at least consumers along the Wasatch Front don't have to worry a whole lot about rising prices. Nationally, the inflation story is a little different. The cost of living locally fell 0.3 percent in October, Wells Fargo & Co. reported Wednesday in its Consumer Price Index. Most major spending areas, including food and gasoline, fell from September to October, with the exception of health care. Although gasoline prices also were down, next month's report could be a different story because fuel prices in Utah have increased in recent days. On Wednesday, the average cost of a gallon of unleaded gasoline was $2.65 per gallon, up from $2.60 one month ago, according to the travel-services agency AAA Utah. Nationally, the cost of living rose a higher-than-expected 0.3 percent last month, with an increase in gasoline prices playing a large role. Excluding the more volatile food and energy costs, though, so-called core prices rose only 0.2 percent for a second month. Both are considered within fairly tame inflation ranges. With unemployment at a 26-year high of 10.2 percent, retailers and other businesses nationwide have little power to raise prices. "I don't see anything in the report that suggests there's any real inflation flare-up," said Joseph LaVorgna, chief U.S. economist at Deutsche Bank Securities Inc. in New York. The Wasatch Front's price index is not seasonally adjusted, while the data for the U.S. is. The adjustment attempts to smooth out fluctuations in the data at different times of the year. The differences in how the two reports are compiled make it difficult to compare them. The Associated Press contributed to this story
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