The market was inclined to take a favourable view of J Sainsbury’s first-quarter trading update, but to a sceptic this looks suspiciously like clutching at straws.
There are positives, not least a return to a small degree of volume growth for the first time in five years, but I remain doubtful that Sainsbury’s and the two other quoted supermarkets have reached the bottom of the downgrade cycle.
Let’s look at those positives. The rate of price deflation on the goods Sainsbury’s sold, excluding fuel as ever, was 2 to 2.5 per cent. The decline in like-for-like sales was lower, at 2.1 per cent, in the quarter. This means that volumes grew by 1 to 1.5 per cent, not much but a nudge in the right