WASHINGTON -- Retail sales rose a larger-than-expected 1.1% in September as consumers shook off fears of looming economic problems and continued to boost their spending after pulling back earlier this year.
The new data Monday came as the Commerce Department revised August's increase in retail sales to 1.2% from the earlier estimate of 0.9%. That meant the rise in August was the largest monthly gain since October 2010.
Economists had expected a 0.8% increase in September, according to a survey by Bloomberg. Retail sales last month were up 5.4% from a year earlier. Sales for the three-month period ending in September were up 4.8% from the same quarter in 2011.
The gains in August and September reverse slow spending in the first half of the year, including month-over-month drops in consumer spending of 0.5% in April, 0.1% in May and 0.7% in June.
"You can forget that old rule of thumb about three consecutive declines in retail sales, watch out, means a recession," said Chris Rupkey, chief financial economist for the Bank of Tokyo-Mitsubishi in New York. "Calling attention to those declines in April, May and June scared people unnecessarily and amounted to nothing."
He said Monday's data show that "consumers are out in force, buying everything that isn’t nailed down."
Strong automobile sales helped boost the overall figures the past two months. But even without autos, retail sales were up 1.1% in September.
The retail sales figures come amid recent positive economic news, including the unemployment rate dropping sharply to 7.8% in September and consumer confidence reaching a five-year high last month, according to a leading gauge from Thomson Reuters and the University of Michigan.