US house­hold net worth rose on eve of fi­nan­cial tur­moil

The Pak Banker - - 6BUSINESS -

NEW YORK: Ris­ing stock prices and home val­ues pushed the net worth of U.S. house­holds higher in the fourth quar­ter, a sign house­holds were on solid foot­ing be­fore get­ting hit by fi­nan­cial mar­ket tur­moil ear­lier this year.

The in­crease added $1.64 tril­lion to the to­tal wealth of Amer­i­can fam­i­lies, putting it at $86.80 tril­lion, a re­port by the Fed­eral Re­serve showed on Thurs­day.

Growth in U.S. con­sumer spend­ing ac­cel­er­ated last year as the job­less rate fell and wage in­creases picked up, but the out­look has been clouded this year by wor­ries over the health of the global econ­omy that have rav­aged the fi­nan­cial mar­kets in Amer­ica and abroad.

Thurs­day's data sug­gests the so­lid­i­fy­ing fi­nan­cial foot­ing would help peo­ple weather fall­ing prices for their fi­nan­cial as­sets. The S&P 500 stock in­dex has fallen nearly 10 per­cent so far in 2016. The in­crease in house­hold wealth came as house­holds added to their debt lev­els at a 3.4 per­cent an­nual pace in the Oc­to­ber-De­cem­ber pe­riod.

Stocks held by house­holds rose in value by $259.1 bil­lion dur­ing the pe­riod, while the value of peo­ple's homes in­creased by $381.9 bil­lion.

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