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Aggregate funded ratio for US corporate pension plans down nearly 4 per cent in August

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The aggregate funded ratio for US corporate pension plans decreased by 3.8 percentage points to end the month of August at 81.3 per cent, according to Wilshire Consulting, the institutional investment advisory and outsourced-CIO business unit of Wilshire Associates Incorporated.

The monthly change in funding resulted from a 7.0 per cent increase in liability values partially offset by a 2.1 per cent increase in asset values. The aggregate funded ratio is estimated to be down 6.2 and 11.4 percentage points year-to-date and over the trailing twelve-months, respectively. 
 
“August’s decrease in funded ratio was driven by the perfect storm of economic forces for corporate pension plans: falling discount rates and negative equity returns,” says Ned McGuire, Managing Director and a member of the Investment Management & Research Group of Wilshire Consulting.  “August’s 3.8 percentage point decrease in funded ratio is the second largest monthly decrease this year and fourth monthly decrease in 2019.”

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