Are accusations Australian supermarkets are price-gouging inflated?

Using market power to generate fatter profit margins at the expense of customers is not illegal. Photograph: Jessica Hromas/The Guardian

Australia’s dominant supermarkets, Coles and Woolworths, argue the competition regulator has found no evidence of price-gouging. The claim undermines Labor’s first big election campaign policy pledge – that it will crack down on the process.

Are the supermarkets right?