WASHINGTON U.S. household net worth jumped to a new high at the end of last year, as the value of real estate and shareholdings rose and bank accounts swelled.
The Federal Reserve said on Thursday net worth increased $2.95 trillion to $80.66 trillion in the fourth quarter, eclipsing a previous record high.
The value of households' property, consumer goods, bank deposits and stocks all increased in the quarter.
The Fed said household net worth rose 14 percent in the full year, driven by a $5.6 trillion rise in the value of shares and a $2.3 trillion increase in the value of real estate.
The U.S. central bank has used ultra-loose monetary policy to encourage a recovery in the nation's housing market following a severe 2007-2009 recession, which has also helped drive U.S. stocks to record highs.
Increases in housing wealth make it easier for families to borrow against the equity in their homes, while overall wealth gains make consumers feel generally more comfortable spending their money. Many economists think consumers spend a few cents of every dollar they gain in wealth.
Growth in household debt slowed to an annual rate of 0.4 percent in the fourth quarter, from 3.0 percent previously, while home mortgage debt fell. Net debt hit $13.11 trillion.
(Reporting by Krista Hughes; Editing by Paul Simao)
Trending On Reuters
India's biggest automaker by revenue reported a drop in quarterly net profit due to a spike in costs despite steady sales of its luxury Jaguar Land Rover unit and an increase in demand for its cars in its home market. Full Article
Shake-up in key Samsung assets to cement heir's grip as succession looms Full Article