More confident consumers break out credit cards

Americans are putting more money on their credit cards after more than two years of cutting back, a sign that they are gaining confidence in the economy.

The first increase in credit-card debt since the financial crisis hit helped to boost overall consumer borrowing 3 percent in December, to a seasonally adjusted annual rate of $2.41 trillion, the Federal Reserve said Monday. It was the third straight monthly gain.

Borrowing in the category that includes credit cards rose 3.5 percent, the first rise since August 2008. Borrowing on auto loans increased 2.8 percent.

Mark Zandi, chief economist at Moody's Analytics, viewed the gain as an encouraging sign that households are becoming more confidence about the economy and jobs. He also said banks are loosening some lending restrictions put in place after the financial crisis.

"The credit spigot is opening," said Mark Zandi,

Even with the December gains, consumer borrowing is just 0.7 percent higher than the more than three-year low hit in September. It is 6.6 percent below the high set in July 2008. But analysts predicted further credit gains in coming months. (more)