Asda has started its biggest-ever discounting campaign with a pledge to cut £50m from the cost of essential food items in the first three months of the year as it aims to make rivals including pound shops and Aldi “look expensive”.

As part of its £1bn five-year price cutting strategy, the grocer is lowering the prices across fresh produce, bakery, meat, fresh fish, frozen food, yoghurts, butter, cereal and toiletries.

A major element of the campaign will be 50p deals on a range of fresh produce and store cupboard staples including cabbage, cauliflower, Kingsmill bread, pasta, Heinz soup, WeightWatchers soup, porridge, biscuits and tinned tomatoes.

Asda will invest £200m in lowering prices this year as part of chief executive Andy Clarke’s strategy to fight back against the discounters and provide a cheaper alternative to its major rivals.

The £200m investment  - an increase of £70m on the £130m it spent on price investment in 2013 - will be used to slash the price of Asda’s successful own label ranges, as well as branded goods.

Asda chief merchandising officer for food Barry Williams said: “It goes without saying that Christmas can be a struggle financially and when you look at the way people have reacted to the sales, it’s more clear than ever that UK shoppers’ priorities are well and truly focused on price.

“That’s why, this January, we are offering more value than ever before across our stores on the products that people actually week in, week out. With hundreds of products at 50p, we’re even making the pound shops and Aldi look expensive.”