Tesco Lowers Profit Sights As British Shoppers Face Winter Crunch

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Confidence among Britain's shoppers sank to a record low last month as they struggle with soaring inflation - even before the government's new economic plan sent mortgage rates surging and sparked fears of a sharp drop in house prices.

Tesco, which has a 27% share of Britain's grocery market, said on Wednesday customers were continuing to change their shopping habits to save money and reduce waste.

⁘Our customers are increasingly concerned about household spending and watching every penny to make ends meet,⁘ CEO Ken Murphy told reporters.

In April, Tesco and Britain's No. 2 grocer Sainsbury's warned of a hit to profits this year as they plough cash into keeping prices competitive to deter customers from switching to German-owned discounters Aldi and Lidl, and face soaring energy and labour costs.

Last month, grocers Morrisons, the Co-operative and Aldi UK all reported profit falls, while clothing retailers Next, Primark, ASOS and Boohoo all warned on profit.

Murphy still expects shoppers to spend this Christmas. ⁘We think it's going to be a Christmas that people are going to want to celebrate, but clearly they're going to want to celebrate it in an affordable way,⁘ he said.

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