UPDATE 1-Panama inflation accelerates in December from two-year low

Fri Jan 11, 2013 2:05pm EST

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PANAMA CITY Jan 11 (Reuters) - Panama's annual inflation rate rose off a two-year low in December, the government statistics agency said on Friday.

In the 12-month period through December, the consumer price index rose 4.6 percent, speeding up from the 4.5 percent increase notched in the year through November.

Consumer prices rose 0.3 percent in the month, compared to November's 0.1 percent rise, mostly due to a 0.8 percent increase in food and beverage prices that was fueled by a rise in vegetable prices.

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 had been declining since August, when it was 6.1 percent.

The government projected average 6 percent inflation for 2012, but it actually clocked in at 5.7 percent, the statistics agency said Friday.

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