The Lagos Chamber of Commerce and Industry has urged the Central Bank of Nigeria to suspend interest rate hikes as a measure to alleviate supply-side pressures contributing to rising inflation.
In a statement released on Monday, the Director-General of LCCI, Dr. Chinyere Almona, responded to the August inflation rate of 25.80 per cent.
It was reported that inflation rose to 25.80 per cent in August 2023, 1.72 per cent points higher than the 24.08 per cent recorded in the previous month.
She emphasized the need for businesses to implement various cost-reduction strategies to lower operational expenses and maintain profitability amidst inflationary challenges.
Dr. Almona also expressed concern about the ongoing decline in households’ real income, especially in the near term.
She pointed out that the uptick in inflation, driven by increases in both food and core components of the Consumer Price Index, raises uncertainty about future price movements.
The LCCI recommended that the government implement prudent fiscal policies, particularly in terms of borrowings. They also called for the immediate reduction or removal of taxes on essential food items to protect vulnerable populations.
Further, the LCCI appealed for palliatives to mitigate the impact of rising inflation on consumers and a temporary pause in interest rate hikes.
Dr. Almona stated, “We implore the government to hasten the provision of the anticipated palliatives to lessen the impact of the rising trend in prices on economic agents.
“Furthermore, we urge the Central Bank of Nigeria (CBN) to pause interest rate hikes to relieve the pressures on the supply side, especially at this time.”