NRF is projecting year-over-year retail sales growth of 4.5 percent.
Electronics and appliance stores’ sales increased 4.5 percent, boosted by sales of the latest iPhone.
Auto sales were up 1.3 percent.
“With recent data painting a more optimistic view of consumer confidence, we can finally see some light at the end of the tunnel,” said Jack Kleinhenz, NRF's chief economist.
“While the latest retail sales data indicates continued improvement for the economy, increasing gas prices and the looming fiscal cliff still pose serious challenges to the momentum we’ve seen in consumer spending.”
Sales increased across all major categories, up 0.6 percent for clothing, 0.4 percent for furniture and home furnishings, 1.1 percent for building materials and garden supplies, 0.4 percent for health and personal care stores and 0.8 percent for sporting goods, hobby, book and music stores’ sales.
Consumer spending represents about 70 percent of economic activity and has been constrained by slow wage growth and high unemployment.
Gas station sales were up 2.5 percent and food sales, which have experienced a rise in prices due to a severe Midwestern drought, increased 1.2 percent.
Retailers caution that while higher gas prices can reflect in a boost spending they also force consumers to shift other spending to gas stations.
Still, excluding autos and gas, sales were up a solid 0.9 percent in September.
High unemployment and weak pay increases have kept consumers from spending more freely this year. That has held back growth. The economy grew at a weak 1.3 percent rate in the April-June quarter. Most economists believe growth will stay around 2 percent for the rest of the year.
The job market has shown modest signs of strengthening as the unemployment rate fell to 7.8 percent last month, the first time during President Obama's tenure that the rate has dropped below 8 percent.
Nonstore retailers’ sales increased 1.8 percent, which also include online shopping, was up 1.8 percent.