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Sainsbury's cuts sales forecast despite record Christmas

8 January 2014 Last updated at 21:26 GMT

Sainsbury's has cut its full-year sales forecast after warning that customers are likely to "spend cautiously" in the first few months of 2014.

Despite seeing record transactions in the run-up to Christmas, it now expects growth of "just under 1%".

The supermarket giant faces tough competition from the high-end Waitrose and discounters Aldi and Lidl.

On Tuesday, the two German-owned firms both said they had seen their best Christmas in the UK to date, although they did not release sales figures.

Emma Simpson reports.

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