Consumer borrowing slows

Consumer borrowing slowed in February.

NEW YORK (CNNMoney.com) -- Consumer credit growth slowed in February, but Americans remained dependent on their credit cards to get through difficult economic times, according to a Federal Reserve report issued Monday.

The total amount of credit outstanding increased by $5.1 billion in February, less than the revised $10.3 billion growth in January. Economists surveyed by Briefing.com expected an easing of growth to $6 billion from the originally reported $6.9 billion.

"This is standard consumer behavior in the face of a recession," said Bill Hampel, chief economist of the Credit Union National Association. "When consumers are worried about losing their jobs, they borrow less."

Overall consumer credit rose 2.4% to $2.54 trillion in February from the revised $2.535 trillion in January.

But revolving credit, which includes credit cards, rose at a faster pace than the overall number, up 5.9% to $951.7 billion after a 7.1% gain in January.

Non-revolving credit, including fixed payments on things such as auto loans, increased at a much slower 0.4% rate to $1.588 trillion as consumers shied away from big-ticket items.

The Fed's measure of consumer credit does not include mortgages, home equity loans, or other debt backed by real estate.

"Historically, for the consumer, home equity loans were the life preserver" said Curtis Arnold, founder of CardRatings.com, a consumer advocacy group.

He added that, with home equity loans so hard to get right now, people are leaning on their credit cards more than usual to make ends meet.

The consumer credit situation right now is what Arnold called a "perfect storm." Credit card issuers are raising interest rates on consumers because they are facing higher delinquency rates and mortgage foreclosures.

"The pattern of February will be continued," said Hampel. "What growth there will be, will be in credit card debt."

The pinch at the pump is hitting the consumer credit situation as well. "With really high gas prices, people are charging their gas more than they usually do," said Hampel.