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Moody’s praises Puerto Rico top court ruling

June 27, 2013

SAN JUAN, Puerto Rico (AP) — A Wall Street ratings agency is praising a decision by Puerto Rico’s top court upholding the constitutionality of a new government pension reform plan.

The statement issued Thursday by Moody’s comes as the U.S. territory tries to salvage a crumbling public pension system that experts say will run out of funds if changes are not made. Gov. Alejandro Garcia Padilla supports the plan, which calls for increased employee contributions, a higher retirement age and reduced benefits and monthly pensions for certain workers.

A group of government workers had filed a lawsuit claiming the reform was unconstitutional.

Meanwhile, New York Federal Reserve President William Dudley said Thursday Puerto Rico hasn’t pulled out of a seven-year recession and that the island’s economy hasn’t bottomed out.

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