British retailer Morrisons has said that customers will continue to feel the squeeze due to price rise, as commodity costs continue to go up.

The supermarket chain, one of UK's four biggest, said that an increase in the prices of commodities such as oil, wheat and grain had led to a slight increase in retail prices with the continuing difficult consumer spending environment keeping volumes under pressure.

Morrisons had reported "another solid performance" in its third quarter despite a decline in customer spending. Sales were up by 1.3 per cent from the same period, last year.

Total sales for the period, not including fuel costs, went up by 2.8 per cent.

The company's shares fell by 2.76 per cent to 282p in early trading.

"In a continuing difficult environment for the consumer, performance in the third quarter has been in line with our expectations. Accordingly our financial outlook for the year remains unchanged," said the company in a short trading update.