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As we had predicted, UK shoppers did not pull back this Christmas, with political uncertainty surrounding Brexit yet to impact spending and confidence. The key themes as ever seem to be premium and luxury but in a value driven environment. The grocery market is back in growth, though with inflation creeping back and prices likely to rise further throughout 2017, volume growth seems unlikely over the next 12 months. Also, we need to remember that the market is growing against a weak comparative in 2015.

In terms of the results out so far, Aldi's strong sales on premium goods and Morrisons’ and Iceland’s push on luxury seems to have paid off. In contrast, the disappointing numbers from Asda highlight the challenges the retailer faces in positioning itself to compete with discounters on price, while being clearly differentiated. With Tesco continuing to grow sales, Asda needs to move quickly to deliver a clear and ownable growth strategy.

Looking forward to seeing the rest of the results later this week!