March 31 (Bloomberg) -- Governor Chris Christie’s move to reduce New Jersey’s pension payment to help close a mid-year budget gap has Moody’s Investors Service concerned that the state is approaching the limit of steps to trim spending.

The second-term Republican is cutting $694 million of spending to balance the budget for the year through June. That includes $94 million from recalculating the required pension contribution as a result of revised actuarial assumptions, Baye Larsen, a Moody’s analyst in New York, said in a report last week.

While the fix will help balance budgets through fiscal 2018, pension costs will be higher in later years as a result, according to Moody’s. New Jersey securities tend to have higher yields than those of similarly rated states because of the burden, said Daniel Solender, director of munis at Lord Abbett & Co. in Jersey City.