Consumer borrowing in the U.S. rose less than forecast in June, restrained by the second decline in credit-card debt in the last three months.

The $6.5 billion increase was the smallest since October and followed a revised $16.7 billion gain in May that was less than initially estimated, Federal Reserve figures showed today in Washington. Economists projected a $10.3 billion rise, according to the median forecast in a Bloomberg survey. Revolving credit, which includes credit card spending, dropped by $3.7 billion. Non-revolving loans, such as those for college tuition or auto purchases, climbed $10.2 billion.

Americans may have been trying to obtain school loans before a possible interest rate increase took place on July 1. President Barack Obama has since signed into law a one-year extension that maintains the lower rate. The strongest auto sales in four months in June showed some households took advantage of cheaper borrowing costs.

“Most of the surge in consumer credit has been due to a pickup in non-revolving credit, specifically student loans,” Joseph LaVorgna, chief U.S. economist at Deutsche Bank Securities Inc. in New York, said in a research note before today’s report. Excluding federal government financing, there’s been “a pickup from the sharp double-digit declines experienced two years ago but hardly a boom,” he said.

Estimates in the Bloomberg survey of 30 economists ranged from gains of $5.5 billion to $15 billion after a previously reported May increase of $17.1 billion.

Non-Revolving Loans

Non-revolving debt, including educational loans and loans for motor vehicles and mobile homes, rose in June after a $9.2 billion increase in May, today’s report showed. Cars and light trucks sold in June at a 14.3 million annual rate, the strongest in four months, according to Ward’s Automotive Group.

Lending by the federal government, which is mainly for educational loans, rose by $5.8 billion in June before adjusting for seasonal variations. Obama last month signed into law a bill to keep student-loan interest rates, now at 3.4 percent, from doubling. The one-year extension on existing rates affects about 7.4 million students, according to the White House.

Revolving debt, which includes credit cards, decreased in June after rising $7.5 billion a month earlier. The report doesn’t track debt secured by real estate, such as home equity lines of credit and home mortgages.

More domestic banks eased lending standards on credit cards and loans for automobiles, according to a July survey of loan officers by the Fed.

Lending Standards

“Domestic banks, on balance, continued to report having eased their lending standards across most loan types over the past three months,” the Fed said yesterday.

Consumer lending standards for car financing and credit card loans eased, while standards for other consumer borrowing were about unchanged, according to the Fed. Banks “reported stronger demand for auto loans,” and an increase in demand for credit card loans, the survey showed.

At the same time, the recovery is still being held back by limited progress in the job market. The unemployment rate rose to 8.3 percent in July, marking the 42nd straight month above 8 percent, Labor Department figures showed Aug. 3. The stretch is the longest of such elevated levels in the post-World War II era.

“Economic fundamentals have remained soft,” Jenny Lin, senior U.S. economist at Ford Motor Co., said on an Aug. 1 conference call with analysts. “Job growth as measured by non- farm payrolls is modest.”

Consumer spending in the second quarter rose at a 1.5 percent annual rate, the slowest pace in a year, according to Commerce Department figures.