Morrisons slashes grocery prices

Morrisons has become the latest supermarket to slash its prices, cutting the cost of at least 130 products in a renewed effort to compete with the likes of Aldi and Lidl.

The discounts will average 22%, but in some cases prices are halved - own-brand egg and spinach tagliatelle is now 56% cheaper, for example.

The price of a Warburtons loaf of bread is going down from £1.45 to £1, and Kellogg's Corn Flakes will fall from £1.45 to £1.09.
%VIRTUAL-ArticleSidebar-deals%
Four pints of own-brand milk is down from £1.39 to £1, and six medium free range eggs are now 29% cheaper at 99p. Own-brand spaghetti falls from 95p to 59p.

"These are ongoing lower price cuts, not promotions," Morrisons marketing and customer director Nick Collard told Retail Week.

"The price cuts we have now made across products that customers buy week in, week out, are making a real difference to the cost of the weekly family shop."

£1bn price cut

Last June, Morrisons dropped the cost of 135 products by an average of 14% - part of a three-year, £1 billion price cut commitment.

In October, it launched a price-match scheme that, unlike the other supermarkets, included a pledge to match discounters Aldi and Lidl. As a result, by November it was rated as the UK's cheapest supermarket in an independent price audit of seven British supermarkets commissioned by the Guardian.

British consumers have, apparently, become used to falling food prices. According to Kantar Worldpanel, grocery inflation has been declining for 17 quarters in a row, and prices have dropped over the last 12 weeks.

"All of the major grocers have continued to compete fiercely on price leading to like-for-like grocery prices falling by 1.2%," says Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel.

"This is another record low, saving Britain's shoppers £327 million over the past 12 weeks."

Improved performance

And while the latest figures from Kantar show that Morrisons' sales slid by 0.4% in the twelve weeks to 1 January, this was its best performance since December 2013.

Last month, the company announced it needed a 'fresh pair of eyes' at the helm. Chief executive Dalton Philips left the company this week, and the business is currently being run by chairman Andy Higginson, who's said he plans to return to basics and "do a good job for customers".

%VIRTUAL-DealsCategoryWidget%

Read more on AOL Money:
Morrisons now 'UK's cheapest supermarket'

Morrisons: are more price cuts the answer?

Big supermarkets reduce fuel again