Climate Risks in Financial Assets
Emanuele Campiglio,
Pierre Monnin and
Adrian von Jagow | 4 November 2019
Discussion Notes,
Monetary | Tags:
Asset prices,
Climate risk,
Climate stress tests This note reviews the empirical evidence available in the academic literature about the impact of climate-related risks on financial assets. It addresses three main questions: does climate change already affect financial asset returns? What is the potential impact of future climate-related costs on financial asset
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Prudential Regulation Can Help in Tackling Climate Change
Paola D'Orazio,
Lilit Popoyan and
Pierre Monnin | 13 February 2019
Blog,
Monetary | Tags:
Environment,
Financial Regulation Awareness of climate-related financial risks has been growing in the past years. Prudential frameworks however still fall short in reflecting them. Given the possible impacts of climate risks on financial stability, incorporating them into prudential regulation is rapidly moving up agendas both among academics and
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Integrating Climate Risks into Credit Risk Assessment: Current Methodologies and the Case of Central Banks Corporate Bond Purchases
Pierre Monnin | 21 December 2018
Discussion Notes,
Monetary | Tags:
Climate risk,
Credit risk,
ECB Corporate Sector Purchase Programme Climate change, and the transition to a low-carbon economy that can mitigate it, engender significant economic costs. These costs are ultimately borne by households and firms. They affect households’ and firms’ cash flows and wealth, which are key determinants of their credit worthiness. Climate-related costs
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Central Banks Should Reflect Climate Risks in Monetary Policy Operations
Pierre Monnin | 10 September 2018
Monetary,
Policy Briefs | Tags:
Asset purchases,
Central Banks,
Climate risk,
Collateral framework The transition to a low-carbon economy requires a shift in capital allocation from incumbent carbon-intensive technologies to new low-carbon technologies. Financial markets play a key role in this process: they influence firms’ investment costs and serve as reference point in investors’ decisions. Currently, there
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Climate Change and Finance: What Role for Central Banks and Financial Regulators?
Emanuele Campiglio,
Yannis Dafermos,
Pierre Monnin,
Josh Ryan-Collins,
Guido Schotten and
Misa Tanaka | 7 September 2018
Blog,
Monetary | Tags:
Central Banks,
Climate Change,
Environment,
Financial Regulation Climate change poses risks to the financial system. Yet our understanding of these risks is still limited. As we explain in a recent paper published in Nature Climate Change, central banks and financial regulators could contribute to the development of methodologies and modelling tools for
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