Panama Inflation July 2016


Panama: Inflation rises month on month in July

August 12, 2016

In July, consumer prices rose 0.10% month-on-month, which contrasted the 0.10% decrease seen in June. According to the National Comptroller’s Office (Contraloría General de la República), July’s print reflected higher prices for 7 of the 12 categories included in the survey. The food and non-alcoholic beverages component tallied the biggest increase while transportation was the component that dropped the most.

Inflation remained steady in July at the 0.1% print observed in June, which is the lowest reading since November 2015. Inflation has hovered at historically low levels owing to still-low oil prices and a strong USD. Due to the country’s dollarized economy, authorities lack the freedom to use monetary policy or exchange rate adjustments to influence inflation. Meanwhile, annual average inflation in July rested at the 0.3% mark for the fifth consecutive month.

Panelists participating in the FocusEconomics Consensus Forecast expect inflation to reach 1.4% by the end of 2016, which is up 0.1 percentage points from last month’s forecast. For 2017, the panel sees inflation at 2.1%.

Author: Jean-Philippe Pourcelot, Economist

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Panama Inflation Chart

Panama Inflation July 2016 0

Note: Annual variation of consumer price index in %.
Source: National Comptroller’s Office and FocusEconomics calculations

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