Tesco boss: Early signs that food inflation is starting to ease

The most recent official data showed that food inflation struck 19.3 per cent in April, dipping only slightly from March’s eye-watering 19.6 per cent and remaining close to the highest rate for more than 45 years. It came as the supermarket group reported total sales of £14.8bn for the 13 weeks to May 27, with a like-for-like sales increase of 8.2 per cent against the same period last year. Its UK division saw a like-for-like sales rise of 9 per cent after it said it saw benefits from customers switching “from premium retailers” amid pressure on consumer budgets.

In a statement, Mr Murphy said: “We are pleased with our performance in the first quarter, underpinned by our relentless focus on value.

"Customers continue to recognise our leading combination of great value and quality in every part of their basket - from essentials covered by our Aldi Price Match, through to our growing Finest range.

He continued: “We are very conscious that many of our customers continue to face significant cost-of-living pressures and we have led the way in cutting prices on everyday essential items.

"There are encouraging early signs that inflation is starting to ease across the market and we will keep working tirelessly to ensure customers receive the best possible value at Tesco.

“The ongoing effort and contribution from our colleagues is evident in the strength of our offer and I want to thank the entire team for everything they do.

"By focusing on our customers we have delivered a strong start to the year. We are well-positioned for the months ahead and are reiterating our guidance for the full year.”

Richard Hunter, Head of Markets at interactive investor, commented: “Tesco continues to keep the competition at bay, which is no mean feat given the current challenging landscape.

“The opening quarter for the group saw a strong increase in both sales and revenues, which grew by 8.2 per cent and 9.4 per cent respectively. “Tesco’s continued laser focus on value has enabled market share to be maintained at 27.1 per cent, with its sheer scale adding to its ability to shave prices, better the supply chain and pull the various group levers to maximise growth.

"Value offerings such as Aldi Price Match, Low Everyday Prices and Clubcard prices all contribute to an appeal which continues to draw in the cost-conscious consumer. The various channel offerings are also playing into the group’s hands. In particular, large store sales grew by 9.9 per cent as the consumer returns to the previous physical shopping habits, although online sales are also picking up any slack with sales growth of 8.2 per cent and a market share of 37.5 per cent.”