Panama: Inflation falls to nearly four-year low in May
June 12, 2014
In May, consumer prices rose 0.13% over the previous month, which came in below the 0.53% increase recorded in April. According to the National Comptroller’s Office (Contraloria General de la Republica), the modest monthly increase was mainly driven by higher prices for tourism and medicine.
Annual inflation decreased from 3.5% in April to 3.2% in May, which marked the lowest level since June 2010. Inflation continues to be above historically-low levels. Due to the country’s dollarized economy, authorities lack the freedom to use monetary policy or exchange rate adjustments to reduce inflation.
Author: Carl Kelly, Economist