Tesco looks well-placed to ride out the cost of living crisis – investors take note

Surging inflation is bad news for retailers. But supermarket giant Tesco looks better placed to cope than most, says Rupert Hargreaves.

Woman in a Tesco supermarket
Tesco’s scale and competitive advantages help it to stand out.
(Image credit: © DANIEL LEAL/AFP via Getty Images)

The cost of living crisis is only going to get worse for consumers. According to economists, the UK is expected to have the highest inflation in the G7 not just this year but also in 2023 and 2024 as the country is far more exposed than other regions to rising energy prices.

Many European countries have placed strict limits on household energy bills while other G7 nations, such as Japan and the US, are much more self-sufficient in gas and other types of energy. Higher energy prices account for around half of the UK’s inflation rate.

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Rupert Hargreaves
Contributor and former deputy digital editor of MoneyWeek

Rupert is the former deputy digital editor of MoneyWeek. He's an active investor and has always been fascinated by the world of business and investing. His style has been heavily influenced by US investors Warren Buffett and Philip Carret. He is always looking for high-quality growth opportunities trading at a reasonable price, preferring cash generative businesses with strong balance sheets over blue-sky growth stocks.

Rupert has written for many UK and international publications including the Motley Fool, Gurufocus and ValueWalk, aimed at a range of readers; from the first timers to experienced high-net-worth individuals. Rupert has also founded and managed several businesses, including the New York-based hedge fund newsletter, Hidden Value Stocks. He has written over 20 ebooks and appeared as an expert commentator on the BBC World Service.