WASHINGTON - Americans took out more loans to buy cars and attend school in February but used their credit cards less frequently for the second straight month.
The Federal Reserve said Friday that consumers increased borrowing by $8.7 billion, the sixth straight monthly increase.
The jump in borrowing was driven by $11 billion increase in the category that mostly measures demand for auto and student loans. Borrowing on credit cards fell by $2 billion after a $3 billion decline in January.
Total consumer borrowing rose to a seasonally adjusted $2.52 trillion. That is nearly at prerecession levels and up from a postrecession low point of $2.39 trillion reached in September 2010. Borrowing had tumbled for more than two years during and immediately after the recession.
Consumer borrowing rose by $18.6 billion in January, following similar gains in December and November. The gains for those three months were the largest in a decade.
‘Consumers still appear to be reluctant to use their credit cards.’
A rise in borrowing could suggest that consumers are feeling more confident about the economy. But few are comfortable enough to step up credit card use. Consumers carried $799 billion in credit card debt in February - 15 percent less than they held in December 2007, the first month of the Great Recession. And student loan debt surpassed the $1 trillion mark for the first time at the end of last year.
Steven Wood, chief economist at Insight Economics, said February’s borrowing increase was strong. But he noted that it was the smallest increase since October. “Consumers still appear to be reluctant to use their credit cards,’’ he said in a note to clients.
Other analysts said Americans might be opting to use cash instead of credit cards as a way to continue paying down their debt. Consumer spending rose in February by the most in seven months.
Most consumers spent more of what they earned. The saving rate dropped to 3.7 percent of after-tax income in February. That was the lowest level since August 2009 and a full percentage point lower than all of last year.
And they paid more for gas. The average price per gallon nationally has risen sharply this year. On Friday, it was $3.94.