Panama: Inflation remains stable in July
August 13, 2013
Consumer prices in July rose 0.27% over the previous month, which came in below the 0.34% increase recorded in June. According to the National Comptroller's Office (Contraloria General de la Republica), the monthly increase mainly reflects higher prices for alcoholic beverages, as well as for clothing and footwear.
In July, annual headline inflation stayed flat at 4.1%. As a result of the monthly increase, inflation remains above the country's historically low levels. In the country's dollarized economy, authorities lack the freedom to use monetary policy or exchange rate adjustments to reduce inflation.
FocusEconomics Consensus Forecast panellists expect inflation to reach 4.4% by the end of this year, which is up 0.1 percentage points from last month's forecast. For 2014, the panel sees inflation inching down to 4.3%.
Author: Carl Kelly, Economist