5.2 million new millionaires created in 2020 despite economic turmoil during the pandemic Business News

The number of millionaires worldwide jumped 5.2 million last year despite the pandemic causing major disruption to the global economy, according to a report.

Soaring house prices and stock markets, aided by low interest rates and government stimulus measures, mean the rich got richer and wealth inequalities widened in 2020.

Credit Suisse estimated that the total value of assets held by households rose 7.4%, from $ 28.7 trillion (£ 20.7 trillion) to $ 418.3 trillion.

The Swiss investment bank report said wealth creation in 2020 “appears to have been completely detached from the economic hardship resulting from Covid-19”.

Credit Suisse estimates there were around 56.1 million people with assets of $ 1 million or more at the end of 2020 – a jump of almost 10% in one year.

The report highlighted growing wealth inequality caused by Covid-19, with wealthier individuals seeing the greatest increase in wealth.

Meanwhile, the less well off, women and disadvantaged groups have been the hardest hit, disproportionately affected by job losses.

Anthony Shorrocks, economist at the University and author of the report, said: “As we noted last year, global wealth has not only remained stable in the face of such turmoil, but has in fact increased rapidly in the second. semester.

However, he added that “if asset price increases are put aside, then global household wealth may well have declined. “

Credit Suisse said the widening gap between the rich and the poor was likely due to the actions of governments rather than the pandemic itself.

Global wealth is expected to grow a further 39% over the next five years to reach $ 583 billion by 2025, while the number of millionaires is expected to increase by almost 50% to 84 million.

Nannette Hechler-Fayd’herbe, Director of Investments for International Wealth Management and Global Head of Economics and Research at Credit Suisse, said: “It is undeniable that governments and central banks have taken steps to organizing massive income transfer programs to support the individuals and businesses most affected by the pandemic and lowering interest rates have successfully averted a large-scale global crisis. “

She added: “The cut in interest rates by central banks has probably had the biggest impact.

“This is one of the main reasons why stock and house prices have thrived, and these translate directly into our assessments of household wealth.”

The regional breakdown shows that North America and Europe accounted for the bulk of total wealth gains in 2020, increasing by $ 12.4 trillion and $ 92 trillion respectively.