October 5, 2016 / 7:16 AM / a year ago

Tesco sees no let up in food deflation in UK market

A company logo is pictured outside a Tesco supermarket in Altrincham northern England, April 16, 2016.Phil Noble/File Photo

LONDON (Reuters) - Britain's biggest retailer Tesco sees no let up in deflation in the UK grocery market any time soon, its boss said on Wednesday.

"As we look at the market and as we predict forward we still see some deflation in the market place," Chief Executive Dave Lewis told reporters.

"That's a reality we faced into the last two years and we think we will continue to face into, certainly into the short term," he said, adding that the market remained "very challenging".

Lewis was speaking after Tesco reported first-half results.

Separately on Wednesday, a survey published by the British Retail Consortium reported a record drop in the cost of food and found little sign of price rises on the back of sterling's sharp fall since June's Brexit vote.

Reporting by James Davey, Editing by Paul Sandle

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