US household net worth rose on eve of financial turmoil
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.