Supermarkets are being investigated by the competition watchdog over high food and fuel prices.

The Competition and Markets Authority (CMA) said it would look at whether a "failure in competition" meant customers were overpaying.

Supermarkets said they were working to keep food prices "as low as possible".

But an investigation into the fuel market, which has already started, has found some supermarkets have increased margins on petrol and diesel.

The CMA said evidence suggested at least one supermarket had set a higher target for its margin on fuel prices in 2022, which could have led to rivals following suit and raising prices too.

The BBC has contacted supermarkets individually for comment.

Asda said it would work "in full-cooperation" with the CMA and added it was "focussed on providing our customers with the best value at the pumps".

Andrew Opie, director of food and sustainability at the BRC, said supermarkets were "confident" that they were "doing all they can to keep food prices as low as possible".

"The UK has one of the most competitive markets for food in the world, and as global prices begin to fall we are confident that the competitive nature of the industry will help food inflation fall as a result," he said.

Higher food prices have been hitting households hard in recent months, and some have questioned why a drop in the cost of wholesale food globally has not led to falls in the prices charged by UK supermarkets.

Supermarkets have said there is typically a three to nine-month lag to see price falls reflected in the shops.

But the war in Ukraine has driven up food prices around the world, and the UK has faced other problems on top of this - from Brexit red tape to labour shortages.