Consumers increased their borrowing in April, with growth in credit card debt rising at the fastest pace in more than a dozen years.

Overall credit expanded by $26.8 billion during the month to $3.18 trillion, up from an increase of $19.5 billion in March, the Federal Reserve reported. That meant consumer debt was growing at a 10.2% annual rate, the fastest pace of growth since July 2011.

The sizable climb is an encouraging sign for the economy, suggesting that consumers are confident enough to increase purchases by borrowing. The jump was fueled by automobiles and student loans, which rose by $18 billion, and credit card debt, which was up $8.8 billion. The upswing in card debt represented a 12.3% gain, the fastest pace since November 2001 when consumers were being urged to spend to bolster the economy after the September 11 attacks.

The April increase continued a string of robust monthly gains and pushed total borrowing to a record high of $3.18 trillion. Increased household borrowing can drive stronger consumer spending, which accounts for 70% of U.S. economic activity.

The rise in credit card balances in April was surprising because of recent trends. Credit card use plunged during the recession when consumers tried to lower their debt as millions of people lost their jobs.

Alan Levenson, chief economist at investment firm T. Rowe Price, said the momentum is likely to continue in coming months, helped by rising employment and steady income growth that will make people more willing to take on debt.

Many banks are showing a greater willingness to extend credit cards and finance car purchases because of growing demand and rising competition, according to a Fed survey of bank senior loan officers at 74 domestic banks and 23 U.S. units of foreign banks from April 1-15.

Credit cards started to rebound in 2011, but those increases have lagged far behind the category that covers auto and student loans, with consumers still apprehensive about taking on high-interest debt. Even with the big April jump, credit card borrowing is up only 2.2% over the past year.

By contrast, the student and auto loan category has advanced at a more rapid 8.2% over the past year, nearly four times the pace of gains in card borrowing.

A separate quarterly report on consumer credit from the Federal Reserve Bank of New York shows that student loans have been the biggest driver of consumer borrowing since the recession ended in June 2009.

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