While low interest rates have been a “boon” to corporate borrowers, the low-yield environment is likely to “exacerbate underfunded pension positions” for corporations in the near term, Fitch said in a new report.
In an Aug. 23 report, the international rating agency explained that the combination of low-interest and the deflationary effects it will have on returns and valuations would lead to “enhanced contributions” as an answer to the underfunded problem. Fitch Analysts Mark Oline, John Culver and James Rizzo compiled the U.S. and Canadian special study.
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