Recently released annual results from Sainsbury’s hardly set the world alight. The FTSE 100-listed retailer generated a rather humdrum 3.4pc rise in sales and a paltry 1.6pc increase in pre-tax profits in the financial year to March 2024. However, in Questor’s view, the company’s results were impressive given the sorry state of the UK economy. Indeed, the economy is currently struggling out of a recession and has posted anaemic growth, at best, since mid-2022. Inflation, meanwhile, remains 120 basis points above the Bank of England’s target, and interest rates stand at a 16-year high after being hiked by over 500 basis points in less than two years. All of this means consumers have experienced a significant cost-of-living crisis that has put tremendous pressure on their disposable incomes. Therefore, Sainsbury’s modest rise in sales and profits is a better result than may appear at first glance. Crucially, the company will almost certainly experience improved operating conditions over the coming years. Inflation will ultimately fall to the Bank of England’s 2pc target as time lags eventually pass, thereby allowing the central bank to implement a more accommodative monetary policy in order to stimulate economic growth. This should not only act as a...