Global pension funds eye currencies for additional returns

Currency managers said they are seeing more inquiries from government and corporate pensions in recent months. — Reuters

EXPECTATIONS for lower returns in stocks and bonds are sending some pension funds into currency markets to diversify their portfolios and bolster performance.

While both equities and fixed income have partially rebounded from last year’s steep declines, some portfolio managers worry the scope for upside in either asset class may be limited, as markets face a tangle of issues including a standoff over raising the US debt ceiling and a potential recession brought on by the Federal Reserve’s aggressive monetary policy tightening.