NEW YORK (CNN/Money) - U.S. consumers lost some of their appetite for credit earlier this year, according to a Fed report released Wednesday, but some analysts warned that consumers are still dangerously in debt, especially with interest rates set to rise.

The Federal Reserve said outstanding credit, excluding mortgage debt, grew by just $4.1 billion in February to $2.02 trillion after growing by a revised $15.8 billion in January. Economists, on average, expected debt to grow by $7.7 billion, according to Briefing.com.

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With personal bankruptcies hitting a record high in 2003, according to the American Bankruptcy Institute, and credit-card delinquencies hitting a record high in the fourth quarter of 2003, according to the American Bankers Association, now might seem like a good time for consumers to be easing up on the debt.

But economists haven't been sweating it. The nation's chief economist, Fed Chairman Alan Greenspan, waved aside debt concerns in a speech in late February, saying household net worth and incomes were rising to keep up with rising debt and that low interest rates had helped keep the ratio of debt to income stable in the past couple of years.

"Overall, the household sector seems to be in good shape," Greenspan said then, and most other economists agree -- for now.

In fact, consumers having so much credit at their fingertips is a good thing for the broader economy right now, because it props up consumer spending, which makes up more than two-thirds of all U.S. economic activity.

But when the tab comes, look out.

"When the economy goes back down again, years down the road, will consumer credit be a major problem, like it was in the 1990-91 recession?" asked Bank One chief economist Diane Swonk. "Yes, it could come back to haunt us. But right now, it's a macroeconomic plus."

Some pain, in fact, could be felt sooner rather than later, if interest rates rise this year -- as almost every economist thinks they will.

Among the first to suffer will likely be those consumers who use credit cards to pay living expenses, according to Allen Grommet, senior economist for the Cambridge Consumer Credit Index, a monthly survey of consumer credit demand.

"Of those planning to use additional credit in March, almost half were using it because they have to to meet their everyday needs," Grommet said. "That, to me, says there is a large group of people right on the edge, having trouble ... and when interest rates go up, that will really pinch them."

In much better shape, of course, are all those homeowners who refinanced their mortgages when rates were at or near 40-year lows, locking in lower monthly debt payments.

The effect was large enough to drive down the national debt-to-income ratio steadily in recent quarters and should insulate many consumers from higher rates.

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But not everybody used their refi money wisely, according to Jim Tehan, a spokesman for the consumer credit education firm Myvesta.org.

Refinancing helped push the mortgage debt carried by Myvesta's customers up some 23 percent in 2003, to an average level of about $208,000, and some homeowners used their refi money to pay off credit cards, only to turn right around and run those same cards back up again.

"That's kind of a double-whammy kick in the head -- many people have the best of intentions when refinancing, but they haven't gotten grips on their spending," Tehan said. "And when you're trading in your credit card debt for loans like that, you're putting your home at risk."

An improving economy should ease the sting of debt for consumers, many economists believe. After suffering its longest slump since 1939, according to many Labor Department measures, the job market has seen signs of spring lately, including a whopping gain of 308,000 new non-farm payroll jobs in March.

But income growth has not yet fully recovered from the recession and long job-market slump, according to many measures, and it will need to keep improving if consumers at the margins are to survive their debt.

"An improving economy doesn't mitigate the pain if the job you have is not the job you had before, if the income you have is not the income you had before," said Luther Gatling, president of Budget and Credit Counseling Services, a debt counseling firm in New York.