Sainsbury's warns household budgets to get tighter

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The boss of the supermarket chain has said that the pressure on household budgets is going to increase.

Costs of living have gone up as energy, food and fuel costs have gone up.

Simon Roberts said that the chain was trying to keep prices low.

Retailers have been put under pressure by the government to reduce costs.

In the 16 weeks to 25 June, like-for-like sales fell 4% compared with the same period a year ago.

A survey commissioned by the British Broadcasting Corporation suggested that people were cutting back on food, fuel and clothes.

Mr Roberts said: "We understand how hard it is for millions of households right now and that's why we are investing £500m and doing everything we can to keep our prices low."

The pressure on household budgets will only intensify over the remainder of the year and I am very clear that doing the right thing for our customers and colleagues will remain at the very top of our agenda.

Underlying profit before tax is expected to be in line with previous estimates, despite the warning.

Shoppers are moving away from branded items to own-label products.

Small firms said the plans were a slap in the face and had already cut expenses.