Global Household Wealth declined by $11trillion in2022 for 1st Time Since2008Financial Crisis
Senior experts at UBS and Credit Suisse banks announced in the Global Wealth Report 2023، published this week، that total private wealth in the world or Global Household Wealth fell 2.4% or $11.3 trillion last year to reach $454.4 trillion، and wealth per adult sank 3.6% or $3198 to $85 thousand in the first drop since the Global Financial Crisis in 2008 But the next few years look brighter as by keeping exchange rates constant at 2021 levels، total wealth actually increased 3.4% during 2022.
Fortune Magazine reported that Global Household Wealth declined last year for the first time since the Global Financial Crisis in 2008 as stock markets tumbled and the strong dollar weighed on asset prices internationally، according to a new report by Senior experts at UBS and Credit Suisse banks entitled، Global Wealth Report 2023.
The Global Wealth Report 2023، covers the holdings of 5.4 billion adults worldwide
The Global Wealth Report 2023، which covers the holdings of 5.4 billion adults worldwide and published Tuesday by UBS and Credit Suisse، found that total Global Household Wealth actually increased 3.4% during 2022، but that still amounts to the slowest increase of wealth at constant exchange rates since Financial Crisis in 2008،” according to the authors of the report.
The Global Household Wealth evaporated last year as the global economy struggled to recover from the COVID19 era in 2022 and high inflation forced many central banks to raise interest rates، increasing the cost of borrowing for consumers and businesses as well as the war in Ukraine weighed on growth allover the world.
Global Household Wealth declined in 2022 for the first time since 2008
The Global Household Wealth declined in 2022 for the first time since the 2008 financial crisis، worldwide household wealth dropped، by a total of 2.4 percent، and about $11.3 trillion was lost from assets، in contrast، global wealth in 2021 soared to a record-high $530 trillion، according to a Boston Consulting Group report last year.
The Global Household Wealth grew at a record pace during 2021 during the Covid-19 era as wealth evolution proved resilient and grew at a record pace during 2021، but inflation، rising interest rates and currency depreciation caused a reversal in 2022 as explained by Nannette Hechler-Fayd’herbe، the global head of economics and research at Credit Suisse Bank.
Global Household Wealth in North America and Europe was hit particularly hard last year
The Global Household Wealth in North America and Europe was hit particularly hard last year، losing a combined total of $10.9 trillion، while the United States is one of the wealthiest countries in the world، Americans on average saw a drop of about $28 thousand and nearly 1.7 million U.S. adults fell out of the millionaire category، while more than 17 thousand adult can no longer call themselves ultra-high-net-worth individuals with $100 million or more.
Despite the downturn in Global Household Wealth in 2022، UBS and Credit Suisse experts expect a turnaround in coming years as global wealth should increase 38% to $627 trillion by 2027 as middle-income countries continue to develop.
Global Household Wealth: total number of millionaires around the world fell by 3.5 million
The Global Household Wealth revealed that the total number of millionaires around the world، fell by 3.5 million، to about 59.4 million people and the globe’s top wealth %1 saw their wealth share drop to %44.5.
The Global Household Wealth report found that while the overall trends appear negative، a few places did see wealth growth in 2022، Russia، for example، gained 56 millionaires، despite sanctions related to Russian President Vladimir Putin’s war in Ukraine and Latin America saw its wealth jump by $2.4 trillion.
Worldwide wealth will continue to grow in the next few years
Even with 2022’s downward slump Global Household Wealth، UBS and Credit Suisse experts believe that worldwide wealth will continue to grow in the next few years as it is predicted that global wealth will reach $629 trillion by 2027، a %38 increase from the most recent figures and the total number of millionaires should rise to 86 million by that year، too.
Developed regions were the hardest hit as stock and bond prices fell throughout the year as North America and Europe lost $10.9 trillion of wealth combined last year، while the Asia-Pacific region lost $2.1 trillion، so perhaps some of those who have fallen off the millionaire list will make back their money in the next five years، as the report of Global Household Wealth indicated.
Africa and India، managed to increase their wealth
Africa and India، on the other hand، managed to increase their wealth by 1.5% ($85 billion) and 4.6% ($675 billion)، respectively، in 2022، whole Latin America total wealth increased 18.6% ($2.4 trillion) amid U.S. near-shoring of manufacturing and a 6% average currency appreciation compared with the dollar.
Global Household Wealth report experts predict that 2022 may just be a blip in the overall projection for wealth growth as it is set to increase by $629 trillion by 2027، or 38% and the number of millionaires could reach 86 million by 2027 from about 60 million in 2022.
Brazil the big winner in 2022
At the country level، Global Household Wealth report experts concluded that the United States saw the largest nominal wealth drop at $5.9 trillion، but that represented just a 4.1% decline from a year ago and the big winner in 2022 was Brazil whose average household wealth surged 31.6% ($1.1 trillion) owing in part to relatively strong 2.9% GDP growth and the Brazilian real’s appreciation compared with the dollar.
Russia and Mexico also increased their wealth by 16.1% and 15.4%، respectively as Mexico saw its currency appreciate versus the dollar، and its GDP grew 3.1% while Russia saw its home prices rise significantly amid lower interest rates and the Russian ruble appreciated by 5.6% on the year.
