Sainsburys is cutting the price of bread and butter as ingredient costs start to fall, raising hopes that Britain's inflationary crisis is nearing its end.
The UK's second biggest supermarket said it was slashing the price of its own-brand loaves of bread by 11pc to 75p, in a move which comes weeks after the chief executive of Tesco said baked goods were likely to get cheaper.
Sainsbury's said it was able to bring the prices down as wheat prices have fallen, following a sharp increase when Russia invaded Ukraine. The country is a key source for cereals.
The supermarket said the move made it the "cheapest in the market" for certain loaves of bread, although other 800g loaves still appear cheaper on German discounter Aldi's website.
The grocer is also cutting the price of its butter by 5pc to £1.89 for 250g, after dairy prices have also started to fall.
Rhian Bartlett, Sainsbury's food commercial director, said: "We have been battling hard to beat inflation and whenever we are paying less for the products we buy from our suppliers, we will pass those savings on to customers.
“As we see the commodity prices starting to fall for wheat and butter, we’re able to lower our prices on two of the products people buy most often, bread and butter."
She added that the supermarket was "constantly considering ways to keep prices low".
It comes amid a row over whether supermarkets are passing on lower prices to shoppers quickly enough, with the Liberal Democrats calling for an investigation into claims of profiteering.
The Office for National Statistics last month said it would expect to see declines in global food prices reflected in supermarkets "but we're not there yet".
Sainsbury's last month pushed back on the claims, with chief executive Simon Roberts saying: "I can only speak for Sainsbury's and I absolutely know that we are doing everything possible to save costs across our company, to negotiate with our suppliers and to give the best value to our customers.
"That's what we are doing every hour of every day and we have been."
The latest reductions come on top of milk prices having already lowered last month, and will be seen as an indication that cost-of-living pressures could be starting to ease.
Grocery prices have jumped by more than 11pc over the past year, according to Kantar, weighing on household budgets and prompting more people to hunt around for the best value in stores.