Consumers increased their installment debts by $2.63 billion in October, the largest rise since April, the Federal Reserve Board said yesterday.
Credit extended for autos was off slightly for the month, but more buyers took out loans using bank credit cards and other loan sources, the agency said.
Newly extended credit rose $620 million in October after declining $40 million the month before. Liquidations rose $350 million to $17.2 billion.
Rising installment credit is considered an important indicator of consumer confidence and can lead to improved business perforance.
The $2.63 billion increase was a stronger showing than the $2.35 billion rise in September and was the largest since a $2.66 billion jump in April. A record was set in March, when the increase was $2.97 billion.
Automobile credit outstanding, which includes both new credit and credit paid off, rose $850 million, compared with an increase of $1.1 billion in September.
However, credit for mobile homes rose $44 million, following a $32 million increase in September; home improvements were up $201 million, compared with $143 million in September.
The figures, adjusted seasonal variations, indicated credit extended for auto declined from $6.10 billion to $6.08 billion. Total credit extended climbed from $19.2 billion to $19.8 billion for the month.
At the end of October, total credit outstanding in the country totaled $209.1 billion, an increase of 16.5 per cent from a year earlier.