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Aldi overtakes Morrisons as fourth-largest supermarket as food inflation hits new record

The latest industry data suggests that discounters are continuing to attract market share at a fast pace as the cost of an average annual grocery bill rises by almost £40 on the previous month.

The stampede to discount chains has helped Aldi overtake Morrisons as the UK's fourth-largest supermarket chain for the first time - with inflation continuing to affect grocery bills.

Kantar Worldpanel reported that Morrisons had a 9.1% share of the grocery market in the 12 weeks to 4 September compared with Aldi's 9.3%.

Discounters have been snapping at the heels of the so-called "big four" - also including Tesco, Sainsbury's and Asda - as the cost of living crisis has worsened.

Kantar said its data shows grocery inflation is at a new record rate of 12.4% last month - adding £571 to the average annual bill. The sum had stood at £533 in July.

Prices were still rising fastest in markets such as milk, butter and dog food, echoing the picture of the previous month.

They are up by about 30% each over the past year as families get to grips with rising bills across the board.

The government is planning to limit hikes in energy bills - the major component of inflation - from October through the new energy price guarantee.

Commenting on the news, Fraser McKevitt, head of retail and consumer insight at Kantar, said: 'It seems there's no end in sight to grocery inflation as the rate at which food and drink prices are increasing continues to accelerate.

'In what is a fiercely competitive sector, supermarkets are reacting to make sure they're seen to acknowledge the challenges consumers are facing and offer best value, in particular by expanding their own-label ranges.'

The big squeeze continues: Regular pay tumbles by 3.9% compared to inflation

The continuing big squeeze on Britons was laid bare today as figures showed wages tumbling.

Although regular pay - excluding bonuses - was ticking up by 5.2 per cent in the quarter to July, that was far behind inflation.

Taking soaring headline CPI rate into account wages fell 3.9 per cent year-on-year, while total pay was down 3.6 per cent.

Meanwhile, there were mixed signs for the jobs market - with vacancies dropping from record highs, but unemployment easing to the lowest level since 1974 at 3.6 per cent.

The latest snapshot was released after inflation jumped to a fresh 40-year high of 10.1 per cent in July as energy and food bills sent costs into orbit.

The Government's move to freeze energy bills at £2,500 is set to reign in the rampant increases and could reduce pressure for the Bank of England to lift interest rates.

However, few experts expect wages to keep pace with prices.

The Office for National Statistics said the number of UK workers on payrolls rose by 71,000 or 0.2 per cent, between July and August to 29.7million.

The number of job vacancies was 1,266,000 over those three months, down 34,000 from the previous quarter in the largest fall since the height of the pandemic.

Sales of the very cheapest own-label value products are up by 33% on a year ago, with almost one in four shopping baskets containing these items.

Overall spending on all retailer own-label lines was £393 million higher during the latest four weeks, pushing their share of the market to 51.1%.

Take-home grocery sales increased by 3.8% over the quarter - the third month of growth in a row after more than a year of decline as a consequence of comparisons with the pandemic.

Separate data from shows the cost of everyday staples have rocketed over the past 12 months,.

The grocery price inflation figure is based on more than 75,000 identical products compared year-on-year in the proportions purchased by British shoppers, which Kantar says represents the most authoritative figure available.

It is seen as a 'pure' inflation measure in that shopping behaviour is held constant between the two comparison periods – with shoppers likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

Grocery market share numbers do not include sales of food or drink consumed out of the home, for example snacks and meals while travelling or at work.


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