Panama: Inflation drops slightly in August
September 12, 2013
In August, consumer prices were unchanged from the 0.27% increase recorded in July. According to the National Comptroller's Office (Contraloria General de la Republica), the monthly increase mainly reflects higher prices for healthcare, transport, and for housing, gas and electricity.
Annual headline inflation decreased to 3.9% in August, down from the 4.1% registered in July. Despite the monthly decline, 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 panelists expect inflation to reach 4.6% 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 4.1%.
Author: Carl Kelly, Economist