Tesco Ireland said that half yearly sales came to €1.5 billion, while it saw total growth of 2.6% in the six months to September.

The company, whose parent group reported half yearly sales of £35.5 billion, said that Irish sales fell by 3.4% due to food price deflation and lower consumer spending, especially on non-food products.

Tesco said that food prices in Ireland have remained low despite continued commodity price inflation worldwide.

Online shopping rose by 20% in the six month period, and Tesco Ireland said that sales of its own brand ranges continued to strengthen. Its mobile phone service continued to expand with customers recently passing the 120,000 mark.

''Irish consumers are adapting to changed economic circumstances, but are still feeling the strain of reduced incomes and uncertainty about the future,'' commented Tesco Ireland's chief executive Tony Keohane.

''We do not see any immediate uplift in domestic economic trends, but we believe the worst may well be behind Ireland,'' he added.

Earlier, the Tesco group reported worsening sales declines today as electronics and entertainment products were hit hard amid the most challenging conditions for a generation.

The supermarket giant said like-for-like sales excluding VAT and petrol fell 0.9% in the three months to August 27, a deterioration on the 0.1% decline in the previous quarter.

Despite the worsening situation in the UK, the group recorded a 6.2% rise in underlying profits to £1.9 billion sterling in the half-year, boosted by a strong performance in Asia. Sales rose 8.8% to £35.5 billion.

Tesco said that the economic background across its markets is not uniform. It said it was continuing to see generally challenging conditions in developed countries, particularly the UK and Ireland compared with continued strong growth in emerging economies.

''However, all our markets remain highly competitive and levels of consumer confidence are generally low,'' the company said..

It said that the strong increase in sales, profits and margins witnessed last year in Europe has continued during the first half. But it added that overall growth was constrained by the ''enduring economic challenges and related austerity measures introduced in Ireland and Hungary, which are important markets for Tesco''.

''Given the current economic conditions in Ireland and Hungary we intend to pursue a low rate of new space growth there until the outlook, and therefore the prospects for incremental returns, improve'', the company said.

Sainsbury's, which also updated on trading today, revealed that like-for-like sales increased by 1.9% in the 16 weeks to October 1 - the same rate as in the previous quarter. Unlike Tesco, its figures include VAT.