Summer sunshine encourages grocery sales acceleration

The warm summer has seen British grocery sales accelerate at their fastest pace since March, with no sign of Brexit-fuelled inflation, figures show.

Grocery sales rose 0.3% in the 12 weeks to August 14 as the sunshine encouraged shoppers to spend more, with the discounters Lidl and Aldi winning market share and sales growth of 12.2% and 10.4% respectively, Kantar Worldpanel said.

There was still no evidence of Brexit-fuelled inflation causing food prices to rise, with a representative basket of goods 1.3% cheaper than it was last year.

Market leader Tesco was the best performer of the "big four" with a sales drop of 0.4%, followed by Sainsbury's, down 0.6%, and Morrisons, who saw sales fall by 1.8%.

Sales at The Co-op rose by 2.8% compared with last year, taking its market share to 6.6% - its highest since 2012.

Asda's decline of 5.5% remains unchanged from last month, making it the poorest performer.

Waitrose sales rose by 1.4% with market share remaining at 5.1%.

Promotional sales dropped to 37.7%, their lowest level since September 2010 as the major retailers continue to move towards simpler pricing models.

Meanwhile, rival research group Nielsen said it was re-assuring to see the industry return to cash growth, helped by the good weather.

It also reported improving momentum at Tesco and an "outstanding" performance by The Co-op, while its figures also showed Asda lagging behind the market with sales down 5.6%.

Mike Watkins, Nielsen's UK head of retailer and business insight, said: "Brexit seems to have been replaced by an Olympic 'feel-good' factor among shoppers and there were more visits to buy food and drink in the last four weeks than this time last year, with most retailers benefiting from an increase in shopper penetration."

He said the figures would have been even better for the supermarkets "if not for the intense price competition, which is, of course, good news for consumers".