R&M's Hanbury backs food retailers ahead of 2017 inflation boost

'Defensive area of the market again'

River & Mercantile's Dan Hanbury has backed food retailers in the £254m UK Equity Income fund, as he said the sector will have a strong 2017 on the back of post-Brexit vote food price inflation.

The manager (pictured) currently holds 1.7% exposure to Sainsbury's in his income fund and exposure to Tesco in a segregated mandate run by the firm. As a result of the outcome of the EU referendum, Hanbury said he expects increased food prices to be a benefit for the sector. Investors sue Tesco over accounting error "You will see food inflation coming back. For the past few years, we have had falling food inflation whereas now you will see inflation coming through. Sainsbury's and Tesco both have a high correlation of outperformance with food inflation," he said. "We could see ...