LCCI Calls Nigeria’s Inflation Slowdown ‘Fragile Disinflation,’ Urges Supply-side Fixes

The Lagos Chamber of Commerce & Industry (LCCI) has described Nigeria’s latest inflation outcome as disinflationary but fragile, attributing the slowdown to cyclical, base-effect, and policy-induced factors.
The Chamber urged policymakers to prioritize supply-side measures to sustain the trend.
The director/general of LCCI, Dr. Chinyere Almona emphasised the importance of supply-side initiatives to maintain the current trend.
She noted that the decline in inflation is primarily linked to a reduction in food prices, appreciated exchange rates, and stable domestic energy costs.
“The easing of food inflation is largely due to improved post-harvest conditions and a return to normal demand levels following the festive period,” she stated.
Almona explained how the benefits from exchange rate stabilisation have reduced imported inflation and the impact on core inflation metrics.
She added that “stable pricing for PMS (Premium Motor Spirit) has helped mitigate transport and logistics costs. Together, these factors have collectively eased inflationary pressures in the short term and enhanced inflation expectations.
“It is important to recognize that a significant part of the year-on-year decline stems from base effects related to CPI rebasing, meaning that the improvements also reflect statistical normalisation alongside other underlying cost pressures. The persistence of core inflation suggests that structural challenges, such as electricity tariffs, transport expenses, rents, and costs of imported goods, remain influential in the current price landscape.”
Moving forward, Almona emphasised that the evolving trend provides the private sector with improved short-term price predictability and reduced cost volatility, aiding inventory planning and pricing strategies.
“However, with real inflation still elevated, challenges such as high borrowing costs, compressed profit margins, and ongoing macroeconomic uncertainty suggest that businesses should focus on tactical rather than long-term strategic planning until a more sustainable disinflation is confirmed,” she noted.
The LCCI encouraged, “the government to prioritize initiatives in agriculture, logistics, energy, and transparency within the foreign exchange market. Monetary authorities are urged to find a balance between controlling inflation and fostering growth, avoiding excessive tightening that could inadvertently escalate real costs. Meanwhile, the private sector should enhance local sourcing, improve supply-chain efficiencies, and adopt disciplined pricing strategies.
“Investors and partners are called upon to direct capital toward food systems, energy production, manufacturing, and infrastructure development to address structural inflation concerns.”
With this constructive outlook, Almona characterized the latest inflation data as indicative of potential disinflation rather than a definitive shift.
“The recent improvements underscore the benefits of food supply recovery, exchange rate stability, and energy price stability, bolstered by base effects. While this fosters increased business confidence in the short term, it is essential to remain aware of the structural factors that keep inflation elevated and susceptible to various shocks,” she stated.

Ultimately, Almona stressed that Nigeria’s policy credibility by 2026 would depend not only on headline inflation figures but also on how effectively the nation transitions from cyclical disinflation to a state of structural price stability through enhanced productivity, logistics improvements, and cohesive macroeconomic coordination.