(Reuters) – The U.S. Household Wealth rose to a record $1150.3 trillion during the fourth quarter last year. This is a financial buffer that could keep Americans spending and reduce the economic impact of Russia’s invasion in Ukraine.

These figures were accompanied by a strong labor market that indicated Americans were relatively healthy before the war. This has led to a surge in commodities prices at a moment when U.S. Inflation is at an all-time high of 40 years.

It is still uncertain how the impact on spending will be felt due to real earnings being below inflation and uncertainties about how long the rise in energy prices will last. This report doesn’t reflect income breakdowns, as lower income households spend more on food and gasoline.

The last week saw gasoline prices rise by almost 17 years. On average, consumers pay more than $4 for one gallon unleaded gas. Other goods such as food will also be more expensive due to Russia’s and Ukraine’s exports of over 25% of world wheat. Ukraine is also a significant corn exporter.

Data from the household finances, covering last October to December 2017, showed that most of the wealth increase was caused by a growth in equity value, which rose $2.5 trillion over a time when it increased approximately 11%.

It was also heavily influenced by the still-thriving housing market that has been on the rise since the COVID-19 pandemic. To the overall wealth, real estate assets contributed $1.5 trillion.

The third quarter 2021 saw an increase in the net worth of households to $145.0 trillion.

U.S. households have accumulated approximately $2.6 trillion in excess savings since the start of the pandemic, JPMorgan (NYSE) economist Daniel Silver pointed out earlier this week. The increase in wealth has been largely due in part to $5 trillion in federal aid over the past two decades.

The aid, which was intended to mitigate the effect of the pandemic upon consumers and businesses, included higher unemployment benefits and direct payments to bank accounts. The programs both ended last year.

Household savings deposits increased to $11.1 billion in the fourth quarter, from $10.7 trillion in the third quarter. According to the report, checking account balances rose from $3.7 billion in the third quarter to $4.1 trillion by the fourth quarter.

The report also shows that household debt increased at 8.0% annually in the fourth quarter compared to a 6.2% annual growth rate for the previous quarter.

Non-financial companies held $7.1 trillion of liquid assets, compared to $6.9 trillion during the July-September period.