The ultra-wealthy lost 10% of their wealth in 2022, study finds

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London, 1 March 2023 (AFP) – The fortunes of the ultra-wealthy have fallen by 10% in 2022, as their investments have been affected by increases in interest rates as a result of the war in Ukraine and by inflation, according to a study by consultancy Knight Frank. The total wealth accumulated by these “very wealthy” people, defined as having at least 30 million dollars (155.8 million reais, including the value of their main residence), “decreased 10% in 2022”, details the study , published this Wednesday (1st). “Last year, the Ukrainian crisis fueled the European energy crisis and triggered inflation. As a result, the year 2022 saw one of the most pronounced increases in interest rates in history,” detailed Liam Bailey, director of research at Knight Frank. However, four out of 10 ultra-wealthy people “saw their wealth increase in 2022, but the overall trend was negative, which is not surprising” because interest rate hikes, implemented by several central banks to tackle inflation, weigh on the wallets of investments, details the consultancy. Europe suffered the biggest drop, with a -17% reduction in these fortunes, followed by Australasia (-11%) and the Americas (-10%). Comparatively, Africa and Asia suffered the smallest reductions (respectively -5% and -7%). “Exchange rates had a significant impact,” while “dollar strength was unparalleled, driven by the Federal Reserve’s unwavering commitment [Fed, banco central americano] with one of the fastest interest rate hikes in history”, continues the report. While “important risks remain for the world economy” in 2023, “market sentiment will change rapidly with very real opportunities emerging in world real estate markets “, with a yield tipping point expected this year, according to Bailey. ode/eb/mab/mb/mvv KNIGHT CAPITAL GROUP

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