REPUBLIKA.CO.ID, JAKARTA - Chief Economist of Bank Mandiri, Destry Damayanti said that inflation would reach 0.75 percent month to month (mtm) in July 2014, while annual inflation of 4.6 percent year on year (yoy). 

Food inflation in Ramadan and Eid al Fitr is under control compared to previous year. In July 2013, monthly inflation was recorded 1.12 percent. 

"Food price has the most influential factor in inflation. I think that government is quite successful in controlling food price in market, especially for sugar and rice. Inflation possibility in this July is still under one percent," Damayanti said recently.

Beside Ramadan and Eid, the increase in consumer demand in market is also due to momentum of school holidays and new school year, as well as 2014 presidential election.

Comal bridge collapse in Pemalang, Central Java could rise logistic costs and increase the goods prices. However, the effect is not significant as government controls the stable price in the market. 

Low inflation has been impacted by gold price as the gold price decreased in July in international market. Industrial electricity rate also increased for second time in early July. In addition, the strengthening of Rupiah against USD also helps to push July inflation.

"We are also supported by IDR appreciation in July," Damayanti said. 

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