Tesco holds UK market share

TNS said Britain's grocery market was fiercely competitive, but largely buoyant and there were signs that the recessionary buying habits of consumers that have characterised the last year were coming to an end.

The growth of hard discounters like privately-owned German groups Aldi and Lidl had slowed, while sales of supermarket premium lines like Tesco's Finest range, were picking up, it said.

TNS said upmarket chain Waitrose recorded the fastest sales growth, echoing the findings of a similar study by researchers Nielsen.

Wm Morrison Supermarkets was the best performing of Britain's top four grocers, achieving a record market share of 12.1 percent, it added.

TNS said Tesco's performance was impressive given that its aggressive promotional campaign might have been expected to depress sales growth in value terms.

Earlier on Tuesday Tesco reported third-quarter sales towards the bottom end of forecasts, blaming lower food price inflation.

TNS said food price inflation slowed to 2.8 percent in the 12 week period, down from the 3.2 percent reported in the 12 weeks to November 1.

(Reporting by Mark Potter; Editing by Greg Mahlich)