US consumer credit rose for a fourth straight month, showing signs that the country’s economy is resuscitating itself after an 18 month recession.
The Federal Reserve said on Monday that total outstanding credit increased by $5.01 billion, after rising $4.09 billion in December.
“We think that consumer spending is on an uptrend which will translate to further gains in consumer credit outstanding in the months to come,” said economist at Barclays Capital in New York Nicholas Tenev, Reuters reported.
According to the Consumer Credit report released on March 7, non-revolving credit, which includes loans for larger items like college education, cars and boats increased by $9.26 billion.
Sophomore Rachel Shannon was relieved that the economy seems to be righting its course.
“I think it’s great that there are signs that things are getting better,” Shannon said. “I felt like I had a lot to worry about when I graduated, with all the talks about recession. This kind of gives me hope that I’ll be okay.”
Reuters reported that as of March there have been sixth straight months of gains, which may be attributed to the 17 percent rise in automobile sales in the United States as of January.
The rise in consumer credit is expected to drive domestic sales upward and promote spending that many people would have been reluctant to engage in during the recession.
Commercial interest rates for new car loans have also dropped from 7.02 percent during the recession in 2008 to 5.87 percent.
According to Reuters the government is expected to report on Mar. 11 that retail sales increased by 1.0 percent in February.