- 15/06/2009 02:00
PANAMA. Panama’s inflation rate has been going down recently but, although that is good news, the economy is beginning to slow down.
According to the British news agency, Reuters, Panama's consumer prices fell 0.3 percent in May compared to the previous month.
The annual inflation rate now stands at 2.5 percent, the government said in a statement.
The monthly reading was helped by lower prices on beverages and food, particularly vegetables.
Panama ended 2008 with an inflation rate of 8.7 percent for the year, driven by high oil prices and strong consumer demand due to robust economic growth, but that panorama is changing.
Analysts had expected inflation to fall to about half this for 2009 but have warned that a recent spike in oil prices could keep inflation above historical norms.
Recently the government announced that the prices of basic food basket products had increased significantly and were likely to continue that trend.
However, other sectors such as real estate have experienced a downturn, especially in commercial and residential rental properties, due to the lack of customers in a market where offers exceed demand.
