Panama: Inflation accelerates in December
January 13, 2011
In December, consumer prices added 0.70% over the previous month, which was above the 0.23% price rise registered in November. According to the National Comptroller's Office (Contraloria General de la Republica), the monthly increase reflected higher food prices, as well as higher prices for transport and housing, water, electricity and gas. As a result of the monthly price increase, annual headline inflation jumped from 4.3% in November to 4.9% in December and remains well above the historically low inflation levels. Panama registered an average inflation rate of 1.4% in the 15 years prior to the price surge that commenced in May 2007 and peaked at 10.0% in September 2008. In the country's dollarized economy, authorities do not have the freedom to use monetary policy or exchange rate adjustments to reduce inflation.