Panama: Inflation eases in March
April 13, 2012
In March, consumer prices added 0.86% over the previous month, which was above the 0.65% increase recorded in February. According to the National Comptroller's Office (Contraloria General de la Republica), although the monthly increase was broad-based, it mainly reflected a sharp rise in prices for transport. Despite the stronger monthly increase, annual headline inflation inched down from 6.4% in February to 6.3% in March. Currently, the inflation rate remains well above the country's historically low levels. Panama registered an average inflation rate of 1.3% during the 15 years prior to the price surge, which commenced in May 2007 and peaked at 10.0% in September 2008. In the country's dollarized economy, authorities lack the freedom to use monetary policy or exchange rate adjustments to reduce inflation.