U.S. household wealth dropped $0.5 trillion to $149.3 trillion in the first quarter, recording its first decline in two years, according to the Federal Reserve Bank report released Thursday.
The decline represents a sharp contrast from gains that began in mid-2020.
The drop was driven by a $3 trillion fall in the value of corporate equities, a plunge that has worsened in the current quarter.
Both the Dow and the S&P 500 lost nearly 5% in the first quarter. The Nasdaq plummeted 9% with almost every top tech company reporting results that were below expectations and recording the worst quarterly performance since the Covid pandemic almost halted the U.S. economy in the first quarter of 2020.
Weighing on the market this year are Russia’s invasion of Ukraine, supply chains disruptions, surging global oil prices, inflation at levels not seen in 40 years and the Federal Reserve plan to hike interest rates.
A $1.7 trillion increase in the value of real estate and a continued high rate of personal saving contrasted with the equities decline.
According to the Fed, household debt grew at an annual pace of 8.3%, reflecting strong growth in home mortgages and consumer credit.
