WASHINGTON (Reuters) — Consumer spending increased by the most in seven months in February as households shook off a steady rise in gasoline prices, the Commerce Department said Friday, leading economists to raise forecasts for growth in the first quarter.

The Commerce Department said consumer spending rose 0.8 percent in February as demand for long-lasting goods like automobiles rose sharply. It also said spending in January was double the previously reported 0.2 percent gain.

Separately, the Thomson Reuters/University of Michigan consumer sentiment index rose to 76.2, the highest level since February 2011, from 75.3 in February. Even with gasoline at about $4 a gallon, Americans were more optimistic about the economy’s prospects in March than at any other time over the last year. “Fears that the economy was going to slow substantially this quarter were overdone. The economy is doing fairly well, given the headwinds from Europe, rising gasoline prices,” said Ryan Sweet, a senior economist at Moody’s Analytics in West Chester, Pa.

With confidence holding up, consumer spending should remain supported in the first half of the year and soften the impact of cooling factory activity on the economy, analysts said.