The Lagos Chamber of Commerce and Industry (LCCI) has reacted to the latest inflation figures from the National Bureau of Statistics, noting a marginal moderation in headline inflation. While acknowledging a short-term easing in price pressures, the Chamber described the trend as disinflationary but fragile, driven by cyclical, base-effect, and policy-related factors rather than lasting structural adjustments.
LCCI highlighted that the slowdown largely stems from decelerating food prices, exchange rate appreciation, and stability in domestic energy prices. Improved post-harvest supplies and normalizing demand helped ease food inflation, while stable petrol prices limited transport and logistics cost increases. Exchange rate gains also tempered imported inflation and pass-through into the core basket.
However, the Chamber cautioned that the year-on-year decline partly reflects statistical base effects, not a durable reduction in underlying cost pressures. Elevated core inflation remains, with structural pressures from electricity tariffs, transport, rents, and imported intermediate goods still embedded in the economy.
“From a business-cycle perspective, the current outcome signals a transition from acceleration to disinflation, but not yet price stability,” the LCCI said. Risks from food supply shocks, climate variability, insecurity, oil price fluctuations, and exchange rate volatility continue to threaten sustained moderation.
Implications for the Private Sector:
- Improved short-term price predictability supports inventory planning and near-term pricing strategies.
- Real-term inflation remains high, keeping borrowing costs elevated, margins tight, and long-term investment uncertain.
- Tactical, rather than strategic, planning is advised until disinflation is sustained.
LCCI Recommendations:
- Government: Prioritize supply-side measures in agriculture, logistics, energy, and FX market transparency.
- Monetary Authorities: Balance inflation control with growth; avoid excessive tightening.
- Private Sector: Strengthen local sourcing, supply-chain efficiency, and disciplined pricing.
- Investors & Partners: Target capital in food systems, energy, manufacturing, and infrastructure to reduce structural inflation.
LCCI concluded that while the recent moderation boosts near-term business confidence, inflation remains structurally elevated. Policy credibility in 2026 will hinge on converting temporary cyclical disinflation into lasting price stability through productivity gains, logistics improvements, and macroeconomic coordination.
