In brief: Consumer borrowing surprises economists
Washington – Consumer borrowing posted an unexpected increase in March, only the second gain in the last 14 months. It could be a sign that households are feeling more confident about boosting spending, a key development needed to support a sustained economic recovery.
The Federal Reserve reported Friday that consumer borrowing rose by $1.95 billion in March, better than the $3.85 billion drop that economists had expected.
Consumer credit was also up in January, but other than those two gains it has been falling steadily since February of last year as households have cut back on their borrowing to repair their battered balance sheets.
The March gain represented a 1 percent rise at an annual rate following a 3 percent drop in February and a 3.2 percent January increase.
The strength came from a big 3.9 percent jump in nonrevolving credit, the category that includes auto loans.
Illness probe points to farm in Arizona
Washington – Lettuce grown in Yuma, Ariz., may be the source of a widespread E. coli outbreak in romaine lettuce that has sickened at least 19 people and prompted a recall in 23 states.
Federal investigators are looking at a farm in Yuma as a possible source for the outbreak, according to the distributor who sold the lettuce.
Freshway Foods of Sidney, Ohio, said Thursday it recalled lettuce sold in 23 states and the District of Columbia because of a possible link to an E. coli outbreak that has sickened at least 19 people – three with life-threatening illness.
Most of the recalled lettuce was sold in states east of the Mississippi River.
AIG posts net income of $1.45 billion
New York – AIG, the insurance giant bailed out by the federal government, reported net income of $1.45 billion for the first quarter as its struggling insurance business showed signs of improvement.
The company also said Friday that recovering credit markets and ongoing efforts to streamline its operations contributed to improved performance.
Shares of AIG surged $1.95, or 5.3 percent, to $38.70 even as the broader market fell.
American International Group Inc., which received more than $180 billion in aid from the government during the financial crisis, said premiums in its primary insurance division fell just 1.1 percent in the first quarter. That was the smallest decline over the past four quarters.
Overall, AIG had net income of $1.45 billion, or $2.16 per share, during the first quarter, compared with a net loss of $4.35 billion a year earlier.