The numbers: Total consumer credit increased $41.8 billion in February, up sharply from a rise of $8.9 billion in the prior month, the Federal Reserve said Thursday. That translates into an 11.3% annual rate in February, up from a 2.4% gain in the prior month. This is the highest rate since November 2001.
Economists had been expecting a $15 billion gain, according to the Wall Street Journal forecast.
Key data: Revolving credit, like credit cards, rose at a 20.7% rate in February after 4% gain in the prior month.
Nonrevolving credit, typically auto and student loans, rose 8.4% after 1.9% growth rate in the prior month. Economists at Contingent Macro said the increase was primarily due to unusual timing of student loan borrowing this year.
The Fed data does not include mortgage loans, which is the largest category of household debt.
Big picture: Economists will be watching consumer spending carefully in coming months to see how households fare as the Fed raises interest rates and tries to move away from its easy money policy stance.
Market reaction: Stocks
DJIA,
+0.25%
SPX,
+0.43%
closed higher on Thursday after suffering losses most of the week after hawkish comments from Fed officials.
