Sales growth at UK supermarkets has fallen to its lowest level for nearly three years due to a sharp drop in food price inflation, new data has revealed.
Figures from market researchers Kantar Worldpanel showed that total sales across the supermarket sector grew by 3.6 per cent year-on-year in the 12 weeks to March 21 – the smallest growth figure since August 2007.
Kantar said the slowdown was promopted by lower food price inflation, which slowed to 1.8 per cent this month compared with 9.1 per cent last year.
However, Fraser McKevitt, retail analyst at the research firm, added that while lower inflation has “had a dampening effect on retailer growth”, it also “brings benefits to consumers”.
“The latest figures suggest that shoppers are taking advantage of slower grocery price increases by trading up to more expensive lines such as Tesco Finest,” he said.
According to the Kantar figures, Morrisons was the strongest performer of the ‘big four’ grocery retailers in the 12 weeks to March 21, with sales up 7.8 per cent on the same period last year.
Next was Sainsburys with sales rising by 4.6 per cent, followed by Tesco (4.1 per cent) and Asda (2.7 per cent).
