Negative performance of Portuguese pension funds continued in September, with new Mercer statistics showing the country’s funds generated negative returns for four consecutive months for the first time since 2005.

In a note released this afternoon, Mercer Portugal said the country’s pension funds had an estimated return of -1.2 per cent for September. This resulted in year-to-date performance of -2.5 per cent.

The result is not as bad as in 2008, when three consecutive months of negative performance at the start and end of the year resulted in a return of -7 per cent.

Mercer attributed the falls largely to the market impact of the continuing absence of a solution to Greece’s debt woes, and the consequent fear around the impact a Greek default may have on other troubled economies.

Rising unemployment, reduced purchasing power, and falling investor confidence in the US were also cited as factors behind the negative performance.

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