UPDATE 1-Panama annual inflation eases to 2-year low in November

Thu Dec 13, 2012 12:24pm EST

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By Lomi Kriel

PANAMA CITY Dec 13 (Reuters) - Panama's annual inflation rate eased to its slowest in two years as transportation costs fell o n declining fuel prices, the government statistics agency said on Thursday.

In the 12-month period through November, the consumer price index rose 4.5 percent, slowing from the 5.3 percent increase notched in the year through October. November's annual inflation rate was the lowest since November 2010 when it clocked in at 4.3 percent.

In the month of November alone, the CPI rose 0.1 percent, on par with October's monthly rise.

Checking inflation in November was a 2.2 percent drop in transit costs as gasoline prices fell, the statistics institute said. That helped offset price rises in other sectors, such as food and beverages, which rose 1 percent and in utilities, which rose 0.6 percent.

Rapid growth in Panama's dollarized economy and massive public infrastructure spending, including a $5.25 billion expansion of the Panama Canal, have fed inflationary pressures.

The annual inflation rate has been declining since August, when it was 6.1 percent.

The government has projected 6 percent inflation for 2012.

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