Supermarkets absorb effects of weaker pound

BRITAIN’S supermarkets continue to suffer sluggish growth, but there has been little impact on the prices they charge consumers from the EU referendum, latest industry figures show.

It had been widely forecast that supermarkets would have to increase grocery prices to absorb higher import costs caused by a weaker pound. However, the fiercely competitive market has meant that price deflation has remained static at around 1.4pc, according to Kantar Worldpanel.

“The EU referendum result has had no immediate impact on the prices retailers are charging or the sales volumes consumers are buying over the past 12 weeks,” said Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel.

However, rival research group Nielsen reported a 2.4pc fall in annual sales in the four weeks to July 16 – the worst figure since July 2014. Nielsen blamed wet and cool weather at the end of June, rather than the EU vote.

Tesco’s and Sainsbury’s market share fell 0.2 percentage points, to 28.3pc and 16.3pc respectively, according to Kantar data covering the 12 weeks to July 17. Asda continued to suffer the heaviest sales decline, off by 5.6pc, which dragged its market share down to 15.5pc from 16.4pc.