NEW YOKR, Sept 10 — US household wealth fell by a record US$6.1 trillion (RM27.4 trillion) in the second quarter to its lowest in a year as a bear market in stocks far outweighed further gains in real estate values, a Federal Reserve report showed on Friday.

Household net worth tumbled to US$143.8 trillion at the end of June from US$149.9 trillion at the end of March, its second consecutive quarterly decline, the Fed’s quarterly snapshot of the national balance sheet showed. Through June, Americans’ collective wealth had fallen by more than US$6.2 trillion from a record US$150 trillion at the end of 2021.

The net drop in wealth in the second quarter was about US$30 billion larger than the previous record decline notched two years earlier, as the onset of the Covid-19 pandemic upended financial markets. That decline — in the second quarter of 2020 — still stands as the largest on a percentage basis at 5.2 per cent versus 4.1 per cent in the most recent report.

The latest fall was led by a US$7.7 trillion decline in stock market values as equities slid into a bear market in the first half of the year on worries about surging inflation and the Fed’s aggressive response with interest rate increases. The equity market drop outstripped a US$1.4 trillion gain in real estate values.

Total nonfinancial debt rose at a 6.5 per cent annualized rate after rising at an 8.3 per cent rate in the first quarter, the Fed data showed. Household debt growth also slowed to a 7.4 per cent annual rate from 8.3 per cent in the first three months of the year, while business, federal, state and local government debt levels all rose. — Reuters