July 22 - John Lewis, Britain's biggest department store chain, reported higher weekly sales on Friday, as cool, wet weather drove shoppers to its shops and its summer sale stimulated trade.

John Lewis Leicester - photo: corbis

The employee-owned business said on Friday department store sales increased 3.7 percent to 59.9 million pounds ($97,6 million) in the week to July 16 and were up 2.1 percent excluding VAT sales tax.

"Continued mixed weather helped drive a solid final week for clearance," said the firm, which has been outperforming rivals for over a year.

"The total clearance period has been a success story with customers taking advantage of more special buys; even excluding the additional two days at the start, sales have been comfortably up on last year," it said.

British consumers are grappling with rising prices, subdued wages growth, a lack of credit, job insecurity, a stagnant housing market, government austerity measures and fears of interest rate rises.

"It will be interesting to see how John Lewis' sales perform now that its clearance sale is coming to an end. The suspicion is that sales will soften in the face of ongoing consumer pressures and caution," said IHS Global Insight chief economist Howard Archer.

John Lewis also owns the Waitrose supermarket chain. Here week to July 16 sales increased 9.8 percent to 101.2 million pounds.

Separately on Friday, John Lewis said it would step up the pace of its expansion by opening at least 10 new "flexible format" department stores.

(Reporting by James Davey, editing by Rhys Jones)