• Price stability still lacking
Dike Onwuamaeze
Lagos Chamber of Commerce and Industry (LCCI) and Centre for the Promotion of Private Enterprise (CPPE) have described the inflation data for January 2026 as a transition from an acceleration phase to a disinflation phase, but not yet to price stability.
LCCI and CPPE made the assertion in different press statements that described their views on the latest inflation data released by National Bureau of Statistics (NBS), which indicated a marginal moderation in headline inflation.
The data showed that headline inflation declined to 15.10 per cent year-on-year, compared with 27.61 per cent in January 2025 and 15.15 per cent in December 2025.
Month-on-month, also, inflation turned negative at −2.88 per cent, indicating an actual easing in the general price level relative to December 2025.
According to the LCCI, “From a business-cycle perspective, the current inflation outcome suggests a transition from an acceleration phase to a disinflation phase, but not yet to price stability.”
For CPPE, “These indicators suggest the emergence of real disinflation rather than temporary price volatility.” It added that it was “the emergence of real disinflation rather than temporary price volatility”.
Director General of LCCI, Dr. Chinyere Almona, said yesterday that the outcome reflected an easing in short-term price momentum, which LCCI considered to be disinflationary, but fragile.
Almona said, “The chamber characterises the latest inflation outcome as a disinflationary signal rather than a structural turning point.
“The moderation reflects temporary alignment of food supply recovery, exchange rate stability, and energy price calm, reinforced by base effects.
“While this improves near-term business confidence, inflation remains structurally elevated and vulnerable to supply and foreign exchange shocks.”
She stressed, “From a decomposition standpoint, the slowdown is largely attributable to food price deceleration, exchange rate appreciation, and relative stability in domestic energy prices.”
Almona said, “The reduction in food inflation reflects improved post-harvest supply conditions and demand normalization after the festive period. Exchange rate gains moderated imported inflation and FX-pass-through into the core basket, while stable PMS pricing reduced second-round transport and logistics effects.
“These developments jointly lowered headline pressure in the short run and improved inflation expectations at the margin.”
She also said the economy was vulnerable to upside inflation risks from food supply disruptions, climate variability, insecurity in agricultural belts, oil price volatility, and renewed exchange rate pressure.
‘Consequently, the present moderation should be interpreted as a temporary easing of inflationary momentum, not yet a convergence toward a low and stable inflation regime,” Almona stated.
Advising the private sector, Almona said the current environment “supports tactical planning rather than strategic risk-taking, pending stronger confirmation of sustained disinflation”.
LCCI said policy credibility in 2026 will depend not on headline inflation prints alone, but on the speed with which Nigeria converted cyclical disinflation into structural price stability through productivity, logistics efficiency, and macroeconomic coordination.
Chief Executive Officer of CPPE, Dr. Muda Yusuf, said January’s inflation data represented “an important macroeconomic shift with implications for household welfare, agricultural income sustainability, monetary policy direction, and private-sector investment strategy”.
Yusuf stated, “Nigeria’s January 2026 inflation outcomes signal a meaningful transition toward macroeconomic stabilisation, driven primarily by declining food prices and supported by easing core inflation.
“The development is positive for household welfare, consumption recovery, and investment confidence, but presents downside risks for farm incomes and rural economic sustainability.
“The central policy priority is therefore to consolidate disinflation while protecting agricultural productivity and rural livelihoods.
“Achieving this balance will be critical to transforming current price moderation into durable stability, inclusive growth, and improved investor confidence in Nigeria’s economy.”
Yusuf said the easing of inflation pressures was broad-based across major components of the price index.
He pointed out that food inflation declined sharply to 8.89 per cent year-on-year, down from 29.63 per cent in January 2025 and 10.84 per cent in December 2025, and a −6.02 per cent month-on-month movement driven by falling prices of staple food items.
He stated that core inflation also moderated to 17.72 per cent year-on-year, compared to 18.63 per cent in December 2025, confirming that price easing is extending beyond food into other segments of the consumption basket, even though underlying structural pressures remain elevated.
In addition, urban and rural inflation rates declined to 15.36 per cent and 14.44 per cent, respectively, indicating the disinflation trend is geographically widespread.
Yusuf stated, “The disinflation trend creates room for cautious and gradual monetary easing. However, this must remain data-driven given that core inflation and 12-month average inflation remain elevated.”
According to him, “The sharp moderation in food inflation carries substantial welfare benefits because food accounts for the largest share of household expenditure in Nigeria.
“If sustained, these developments could stimulate retail trade, manufacturing utilisation, and service-sector activity, thereby supporting broader economic recovery.”
Yusuf, however, stated that while declining food prices benefited consumers, they also posed risks for farm incomes and rural economic stability.
“There is, therefore, a critical need to balance consumer affordability with producer sustainability to safeguard national food security,” he said.
He also urged government to deploy targeted measures to protect farm incomes while sustaining food affordability, including productivity support, minimum guaranteed prices for selected crops, strategic reserves, and expanded agro-processing capacity to absorb surplus output.
Yusuf said the latest inflation figures had implications for consumers, investors, and business strategy.
He said, “Easing inflation—particularly food inflation—signals gradual recovery in real household demand, creating opportunities in consumer goods, retail, logistics, and services.
“Disinflation reduces the ability of firms to rely on price increases for revenue growth, thereby increasing the importance of cost efficiency, productivity, and scale.
“Sustained disinflation could support gradual interest-rate moderation and improved equity valuations, favouring long-term productive investment over short-term inflation hedging.”
