Britons are buying less, switching to cheaper products and shopping more often as they try to cope with rapidly rising inflation, according to supermarket giant Tesco, which described the market environment as “incredibly challenging”.

Tesco maintained its full-year earnings guidance despite reporting a 1.5% drop in underlying UK sales in the first quarter to May 28, broadly in line with analysts ‘ expectations. In the previous quarter, sales had fallen by 1.2%. For the full year 2022/23, Tesco predicts an adjusted operating profit for the retail sector of between € 2.7 billion and € 3 billion, down from € 3 billion in 2021/22.