Money in Panama:
The Panama Balboa (PAB), (USD): The official unit of currency in Panama is the Panama balboa. However, the official paper currency of Panama is the US dollar.
The exchange rate of the Panama balboa to the US dollar is anchored at one to one.
Panama stopped printing the Panama balboa in 1941 in favor of the US dollar.
Panama money tips:
Panama does still mint balboa coins, but they're the same size, shape and metal of the equivalent US coins, and can be used interchangeably. That means they work in US vending machines -- although I can't vouch for the legality of doing so.
Extensive Panama banking information and tips on other money matters can be found at the Panama Information Guide.