What's going on?

Tesco posted strong full-year results on Wednesday, but the UK�s biggest supermarket chain has a target on its back�

What does this mean?

The odds a grocery retailer would sustain its mid-pandemic momentum were slim, but Tesco has risen to the challenge: its sales are still going strong, while the cost of Covid-related cleaning and maintenance have been coming down. That led the retailer to deliver a pre-tax profit more than three times as high as the year before. Tesco is, of course, well aware that higher prices are eating into shoppers� budgets, and it�s duly warned that this profit could drop off this year. But it has a plan to nip that in the bud: the company�s looking to cut jobs and revamp overnight operations, all in view of saving around $1.3 billion over the next three years.

Why should I care?

For you personally: Rivalry is healthy.
Tesco has stiff competition in the form of German discount grocers like Aldi, which last month hit a record market share of the UK grocery market (tweet this). That�s put pressure on Tesco to protect its spot at the top of the food chain, which is no bad thing for you: it�s being forced to keep prices low to stay competitive, meaning it�ll absorb some of the record-high food costs rather than pass them on to you.

The bigger picture: Will it ever end?
Another day, another calamitous inflation reading: data out on Wednesday showed that UK consumer prices rose by a higher-than-expected 7% last month compared to the year before � a 30-year high. Prices were up in every category, with a quarter of them seeing lurches of more than 10%. Consider too that April is the first month where the government has lifted its energy price cap, and you can probably see where this is going�