The retailer is looking to tackle the 'Aldi effect' which has seen cash-strapped shoppers flock to discount chains in recent months as food bills soar, the Sunday Times reported.

Tesco's move - said to be planned for the autumn - will drive down the prices of hundreds of items in its standard own-brand range.

According to the latest figures from market researcher TNS Worldpanel, Aldi took a record 2.9% share of the market in the 12 weeks to June 15 after a near 21% rise in sales.

Lidl and Iceland also saw double-digit sales growth as consumers try to cut their bills, with Tesco and Sainsbury's losing market share as a result, TNS said.

At Tesco's last trading update a month ago finance director Andrew Higginson said value-orientated rival Asda and the discount chains were "having a moment in the sun".

Tesco also sells Value and Finest products but is said to be looking at ways to bring down the price of its standard ranges without affecting the taste.

The move comes amid fierce recent competition in the supermarket sector, with Tesco dropping prices on 3,000 items and Asda selling a range of staple goods for just 50p as the battle for shoppers hots up.

One of the major casualties of the tough conditions in the grocery sector has been Marks & Spencer. Shoppers have snubbed its high-end convenience food in the past three months, with food sales falling 4.5% on a same store basis amid a "significant weakening" of the business. M&S director of food Steven Esom has left after little more than a year in the job.

Tesco was unavailable for comment on the story although it told the Sunday Times it was looking to "make things easier" for its customers, with plans involving looking closely at its own-brand products.
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