New York City’s five pensions rebounded in the last fiscal year, boosted by a rally in domestic and international stocks in the first half of 2023.
(Bloomberg) — New York City’s five pensions rebounded in the last fiscal year, boosted by a rally in domestic and international stocks in the first half of 2023.
The city’s $253.2 billion pensions for police officers, fire fighters, teachers, civil employees and school personnel returned 8% in the year through June, beating their 7% target, according to a news release Monday from city Comptroller Brad Lander. Stocks surged in the first six months of 2023, as US job growth remained solid and inflation moderated.
The city’s pension funds allocate 45% of assets to stocks, 30% to bonds and 25% to alternatives such as private equity and real estate. Public markets accounted for the majority of returns, while alternatives were close to flat.
Last year, the funds lost 8.65%, the worst return since 2009, as high inflation, aggressive Federal Reserve interest-rate hikes and fears of a recession hammered the retirement plans along with financial markets broadly.
The return for fiscal 2023 will reduce the city’s required contributions to the funds by about $550 million over the next five years, leaving more money available to spend on other obligations, Lander said.
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