John Lewis has reported "much stronger" trading in the past week, with big-ticket purchases boosted by the 2.5 per cent cut in VAT announced in the Pre-Budget Report.

In a trading update this afternoon, the department store, which is regarded as a leading indicator of high street spending, also reported a rise in Christmas gift sales.

Nat Wakely, director of selling operations at John Lewis, said: "Trade so far this week has been much stronger than we have seen in the last three weeks with a noticeable uplift in Christmas gift purchasing."

John Lewis implemented the 2.5 per cent cut in VAT, announced by Alistair Darling, the Chancellor, last week, on Friday, three days before it was officially introduced.

Mr Wakely said that the move, which reduces the tax to 15 per cent, had helped sales of big-ticket products.

"There has also been a clear increase in big-ticket purchases since the VAT reduction, which we had fully actioned by last Friday," he said.

Today's buoyant statement follows one of the toughest trading periods for the retailer in recent history.

Last week, total sales fell 13 per cent and five stores reported drops of more than 20 per cent, despite discounting efforts to match price cutting by rivals.

In the second week of November, John Lewis reported a 14 per cent fall in sales.

Other retailers are striving to win shoppers in the run-up to Christmas. Today Marks & Spencer is holding a second one-off "Christmas spectacular", knocking 20 per cent of the price of many items and extending opening hours in some of its stores.

Items in demand at John Lewis over the past week include women's cashmere jumpers, boys' pyjamas and men's fleece-lined gloves.

Toy sales were strong with a 73 per cent rise in sales of Scalextric and a 163 per cent rise in sales of Star Wars merchandise.

In an indication of Christmas preparations being made by shoppers, the retailer said it sold enough roasting tins to cook more than 6,000 kg of turkey, and many chocolate coins that, if they were real, would be worth £19,224.

Perhaps less predictably, John Lewis also sold one scented space diffuser — a more elaborate version of an air freshener, which retails at £24 — every four minutes.

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