Morrisons is eyeing further price cuts and expanding its delivery deal with Amazon as the supermarket battle to win shoppers heats up.

David Potts, chief executive of Morrisons, told shoppers to expect a renewed focus on prices later this year after the supermarket slashing prices on more than 400 items in 2020.

He said: “We wake up every day thinking about how competitive we can be rather than what profit margins we can achieve.

“People are in spend, spend, spend mode. Price is an important part of that. We will become more competitive again.”

Morrisons' pledge to lower prices follows the launch of aggressive price match campaigns by Tesco and Sainsbury's which have also cut prices on hundreds of products.

Mr Potts said Morrisons is also planning expand its home delivery tie-up with Amazon following surging demand for online grocery shopping during the coronavirus crisis.

Orders placed through Amazon are currently picked from 65 Morrisons stores.

Mr Potts said: “The answer is more [stores]."

Morrisons posted a slowdown in quarterly sales growth on Tuesday faced with tough comparisons a year ago when shoppers rushed to stockpile food and lavatory paper in the first lockdown.

Like-for-like sales, excluding fuel, rose 2.7pc in the 14 weeks to May 9 compared with a year earlier, a marked slowdown on the 9pc rise recorded in the previous quarter. Compared with the same period in 2019, sales grew by 8.7pc.

Online sales more than doubled during the period, driven by orders placed through Amazon and Deliveroo.

Mr Potts said he expected a further sales boost this summer driven by the relaxation of coronavirus restrictions along with major sporting events such as the Euro 2020 and the Olympics. BBQs, pizzas and beer are expected to be particularly popular among shoppers.

He said: “That sense of optimism is percolating through the country and it will lead to people wanting to celebrate events.

“The pandemic is not yet over, but it is in retreat across Britain and there is much to be positive about as something approaching normal life begins to take shape. We'll be doing everything we can to be part of that."

Mr Potts said food-on-the-go was already beginning to rebound strongly as people travel more, with increased demand for the supermarket's £3 meal deals.

He said: “Quite a lot of people are working a bit less from home … We are seeing smaller baskets, more frequent shopping trips.”

Morrisons said it expects a further boost when its cafés reopen from Monday.

Morrisons said full-year pre-tax profits are expected to be higher than last year when they totalled £431m, but this is before the impact of its decision to waive business rates relief is included. It also plans to cut debt further.

Clive Black, a retail analyst at Shore Capital, Morrisons' house broker, said: “With Amazon in tow, Morrisons has a really strong platform in this market, augmented by its relationship with Deliveroo too in which Amazon is a major shareholder.”

Morrisons said it would refresh its long-term capital allocation plans when it reports interim results in September, but declined to elaborate further.

Shares rose 1pc to 185p, valuing the company at £4.5bn.