British supermarket giant Tesco said Friday there are “encouraging early signs” of easing inflation, but customers are still looking to save cash in a cost-of-living crisis.
Recent data showed UK inflation slowed to a 13-month low in April, but remains elevated at 8.7 percent as soaring food prices offset weaker energy costs.
“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,” said chief executive Ken Murphy in an upbeat trading update.
He added: “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.”
Tesco also revealed that retail sales excluding fuel rose 9.3 percent to £14.8 billion ($18.9 billion) in its first quarter to the end of May, from a year earlier.
The performance was also boosted by its strategy to match prices of similar goods offered by UK supermarkets run by German discounters Aldi and Lidl.
Tesco added that it is “well-positioned for the months ahead” and maintained its full-year guidance.
In late morning deals, the company’s share price dipped 0.9 percent to 262.20 pence on London’s rising stock market.
“Tesco is managing the weakening consumer landscape about as well as possible,” said Aarin Chiekrie, equity analyst at stockbroker Hargreaves Lansdown.
“That’s being helped by the group’s enormous scale.”
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