·
The net worth of the US household sector rose 10.2% last quarter versus
3Q03. The year to year rate of increase is slower than the 14.4% gain in
1Q04.
· The rise was driven by a 10.0% y/y rise in total asset values. Tangible asset values rose 13.1% y/y as the value of real estate holdings surged 15.4%. Financial asset values rose a lesser 8.2%, held back by higher interest rates which lowered the value of treasury issues by 19.1%. Money market share values also fell 11.6%. Higher prices in the stock market helped lift the value of mutual fund shares by 18.1% and the value of corporate equities held directly by 7.5%.
· Foreign sector holdings of total US assets rose 20.7% y/y raising the foreign sector's ownership share of total US financial assets to an upwardly revised 12.7% versus 7.0% ten years ago.
· Growth in total credit market debt
outstanding was steady at 7.8%. The federal government and US households
continued growing debt at or about a double digit rate and nonfinancial
corporations' debt grew just 3.3%.
· Total credit market debt owed by the household sector rose 9.8% y/y as home mortgage debt rose 11.5%. Consumer credit rose 4.3%.