Newark, New Jersey’s largest city, will get a $32 million short-term state loan to plug a $57 million hole in its $750 million budget caused in part by rising pension and health-care costs.

Under terms of the deal announced Tuesday, the state Department of Community Affairs will install a full-time fiscal oversight officer in City Hall. It will require Newark to halt new spending and identify new revenue and budget cuts to close the remaining $25 million gap.

“The fiscal oversight officer will encourage the city to take action to address a growing structural deficit in 2012,” Thomas Neff, director of the state division of Local Government Services, said in a letter to the state. “The rating agencies and the financial communities view formal oversight in a positive manner.”

Moody’s lowered its rating on $500 million in outstanding Newark debt by one level at the end of last year, citing the city’s weakened fiscal position. Investors demanded a risk premium of 103 basis points above top-rated municipal debt for Newark’s bonds Monday, according to a Bloomberg Valuation Index. A basis point is 0.01 percentage point.

Julien Neals, the city’s business administrator, said in an e-mail that Newark has cut its deficit by $100 million since 2009 and trimmed its workforce to the lowest level since 1988.

“Our city, as well as the nation, continues to endure the worst economy experienced in decades,” he said. “As we continue to explore additional cost-saving and revenue-inducing measures, we have partnered with the state and will accept transitional aid as a bridge that will ultimately contribute to the restoration of our city’s fiscal integrity and prosperity.”