Deutsche Bank has released its latest supermarket inflation survey. The survey averages the price on 100  comparable goods bought from Coles, Woolworths and IGA. These goods spanned 29 product segments and were bought from three Coles, three Woolworths and one IGA store.

The survey showed that both Coles and Woolies are cutting the price of their private label brands in an effort to match Aldi.

The average price of private label goods, from the big two supermarkets, showed a 6.1 pe cent drop in the June quarter – the steepest decline in 18 months.

Aldi currently sell their private label brands at a whopping 30 per cent less than those found at Coles and Woolies.

But be warned, Coles and Woolies are making up the difference in other ways.

The survey found that Coles has increased the price of their national brand groceries by 5.1 per cent, while Woolies increased theirs by 2.6 per cent.

The price for branded groceries rose overall by 1.38 per cent in the June quarter. Only a modest rise compared with the 2.8 per cent of the previous quarter.

Micahel Simotas and Daniel Wan, analysts for Deutsche Bank, wrote: “Notably, Coles did not appear to match Woolworths’ discounting.

“The aggressive price investments from Woolworths on branded products make some sense to us given these are the products where Woolworths became too expensive.”

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