UPDATE 1-Panama consumer prices rise 1.2 pct in March

(Adds context about the dollar and next year's election)

PANAMA CITY, April 14 (Reuters) - Inflation in Panama rose 1.2 percent in March from the previous month, the government said on Monday as Panamanians struggled to cope with the double effects of high global food and fuel prices and a weak dollar.

Twelve-month inflation at the end of March was 8.8 percent.

With the country heading for a presidential election in May 2009, the government has announced a series of measures to cut the tax burden for ordinary Panamanians in the hope of easing the effects of high prices.

The weak dollar has pushed up the price of some imports. Panama has used the dollar as its currency for over 100 years.

Strong domestic economic growth has also pushed up wages and prices. In 2007, gross domestic product was up 11.2 percent, but it is expected to cool to around 8 percent growth this year.

Panama's agriculture minister is expected to meet his Central American counterparts in El Salvador later this week to look at measures to boost agricultural production of staples such as rice, corn and beans. (Reporting by Andrew Beatty; Editing by Jan Paschal)