U.S. public pension funds face nearly $ 1 trillion losses - Moody's

Moody's Investors Service said on Tuesday that the market crash and the economic fallout from the coronavirus has caused investment losses of about $ 1 trillion for US public pension funds.

The credit rating agency said :"US public pension systems are on pace for investment losses well into double digits US public pension systems are generally on pace for an average investment loss of about 21% in the fiscal year that will end on June 30, based on a March 20" .

 "Without a dramatic bounceback of investment market, 2020 pension investment losses will mark a significant turning point as the negative exposure to credit quality to some state and local governments to pension risk pays off due to the already increased commitment and reduced ability to defer costs," Tom Aaron, a Moody’s vice president, said in a statement.

If investment losses are not reversed, governments could face a nearly 60% increase in pension contributions in fiscal 2021 to prevent unfunded liabilities from growing, according to Moody’s.

Economic stimulus

On the other hand, White House aide Eric Ueland said on Wednesday that members of the Senate and administration officials had reached an agreement on a massive economic stimulus bill to mitigate the effects of the outbreak of the Coronavirus COVID-19.

After several days of negotiations on the two-trillion-dollar stimulus package, we reached an agreement, Ueland told reporters.

The united states senate is expected to vote on the bill in Wednesday.