Looks like the holiday will be even jollier than first thought – at least for the nation’s retailers.

The National Retail Federation has revised its holiday forecast upward, expecting holiday sales to rise to 3.8 percent this year.

The overall forecast is a record $469.1 billion in sales. NRF’s initial forecast called for anticipated sales growth of 2.8 percent. While 3.6 percent is above the 10-year average, it is lower than the 5.2 percent increase retailers saw last year.

“After strong sales reports in October and November, along with a successful Black Friday weekend, retailers are cautiously optimistic that this season will turn out better than initially expected, bringing added stability to our recovering economy at a time when America needs it most,” said NRF president and CEO Matthew Shay. “However, a number of factors, including the debt crisis in Europe and continued political wrangling in Washington, could impact consumer spending this holiday season and into 2012.”

The forecast revision comes on the heels of two promising pieces of news. On Tuesday, the NRF announced that retail industry sales for November rose 4.5 percent year-over-year. In addition, NRF’s most recent holiday survey found that the average American has completed far less of their holiday shopping than in previous years – an indication that many shoppers bought for themselves in November and still have plenty of holiday shopping left to do.

“Consumer spending this holiday season has surpassed expectations, though many shoppers continue to stick to their budgets and buy only what they need,” said NRF Chief Economist Jack Leinhenz. “Despite modest job and income growth, consumers have continuously proven they have the capacity to spend, and we are encouraged by the recent sales growth we have seen so far.”

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