A US government data due out Friday is expected to show that the rate of consumer borrowing slowed in April, but Americans still racked up more debt on their credit cards.

The Federal Reserve is expected to release its consumer credit report at 3 p.m. EDT. The report will show that consumer borrowing for April rose by $7.4 billion, according to a consensus estimate of Wall Street economists surveyed by Thomson/IFR. That's down from the $15.3 billion increased in borrowing in March. Economists' latest estimates for April ranged from $5 billion to $10.5 billion.

In the same month a year ago, consumer borrowing increased by about $3.3 billion. In the monthly report, the Fed measures revolving credit, primarily credit cards, and nonrevolving credit, used to finance cars, vacations and education, among other things. The measure does not include mortgages or other loans secured by real estate.

IFR Markets analysts said they expect borrowing in the category that includes auto loans slowed in April, from the prior month. But they expect credit card debt rose considerably, reflecting the largest increase in five months.

Consumers have been using their credit cards more as banks tightened lending standards for home equity loans.

In March, consumer debt - which stood at a record $2.56 trillion overall - jumped at an annual rate of 7.2%, up from a 3.1% growth rate in February. March's gain, which was much larger than what economists had expected, reflected strong borrowing on credit cards and in the category that includes auto loans.

The Commerce Department last week reported that consumer spending edged up by a meager 0.2% in April, just half the 0.4% rise in March. But, once inflation was removed, the performance was even weaker, reflecting no gain in spending.

Wall Street is closely monitoring consumer spending because it represents about 70% of U.S. gross domestic product, which measures the value of final goods and services produced.

On the other hand reports suggest that British consumers who are good payers are being penalised by their credit card firms because they do not generate enough profit for the provider in terms of interest rates and charges.

Two years ago the Office of Fair Trading (OFT) declared that default charges on credit cards were too high and suggested capping these at £12. But market analysts say that although lenders have reduced penalty charges, they have also resorted to desperate measures to recoup lost revenue including hiking rates and fees elsewhere.