Public Pension Reckoning Delayed With Stimulus Pumping Up Stocks
- Pensions may return 2% for fiscal year, BNY Mellon estimates
- Retirement systems were on pace for 21% loss in March
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U.S. public pensions may have finished the fiscal year with small gains, a dramatic turnaround after losing about $1 trillion during the first quarter when the coronavirus pandemic triggered a stock market plunge.
In March, U.S. public pensions were on pace for an average investment loss of about 21% for the year ending June 30, according to Moody’s Investors Service. Thanks to massive monetary and fiscal stimulus, state and local retirement funds, which invest about half of their assets in U.S. and foreign stocks, may have returned 1.9%, according to an analysis by Bank of New York Mellon Corp. Moody’s estimates one-year returns at about 1%.