High cost of goods worries LCCI

The Lagos Chamber of Commerce and Industry (LCCI) has expressed concern over the continued uptrend in domestic consumer prices as headline inflation further accelerated to 16.47 per cent in January 2021, the highest since May 2017.

The uptick in domestic prices, according to the Chamber’s Director General, Dr. Muda Yusuf, was largely driven by the persistent food inflationary pressures, with food inflation hitting a record 20.57 per cent, the highest level since the 2009 Consumer Price Index (CPI) series began.

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According to Yusuf, key drivers of core inflation on the other hand include naira exchange rate and foreign exchange liquidity concerns evidenced by the widening premium between the Nigerian Autonomous Foreign Exchange (NAFEX) and parallel market rates, which, according to Yusuf, have disrupted production plans of many manufacturing firms following acute shortages of raw materials and other inputs.

Other drivers of core inflation are higher energy costs, which have been on an upward trajectory for two consecutive months, among others.