Budget buyers boost Asda

The discount grocer reported that like-for-like sales, stripping out new store openings, surged 7.2% in the last quarter.

Supermarkets have enjoyed huge sales during the recession as families attempt to cut the weekly food bills by buying in bulk.

The most recent sets of figures from rivals have shown Morrisons growing at 8.2% and Sainsbury's up 7.8%.

Even Tesco, which is far bigger than any of its rivals, last reported sales growth of 4.2%.

Asda claimed it had increased its market share and put its success entirely down to cutting prices. The Government this week proposed banning certain promotions, such as "buy-one-get-one-free" deals in supermarkets, to cut down on food wastage.

But Standard & Poor's Equity Research analyst James Monro said: "The more bad news you get on the UK economy, the more people focus on their budget and tighten their belts.

"The consumer will always go for value when things are tough. Asda is known for its value and Bogof-type deals so people are going there to do their really big shop."

However, Asda chief financial officer Judith McKenna said: "Consumers continue to be somewhat cautious, with many people choosing to use any extra money they have to pay down debt and save more."