During the Expert XP 2022 panel, this Thursday (4), the chief of staff of the Central Bank (BC) Regulation Director, Ricardo Harris, said that climate change affects the monetary policy of central banks around the world.
“The increase in the frequency of these extreme weather events has a relevant impact on economic variables that are important in the management of monetary policy”.
Harris also said that the NGFS (Network for Greening the Financial System) – a network of 114 central banks and financial supervisors that aims to accelerate the expansion of green finance – is the main forum for discussion, knowledge production and guidance for central banks to develop strategies on how to address the issue of climate risk.
“The group has produced, in recent years, a series of guides and reports to assist BCs in dealing with issues related to climate change, in supervision… in how supervision can act on their regulated, in how BCs can incorporate aspects of the ESG in the selection of assets that make up the international reserves”, he said.
The BC director recalled, for example, the drought that Brazil faced in 2021, highlighting the impacts on the institution’s decisions.
“Climate risk affects one of the primary discussions of central banks: the management of monetary policy. Just see, last year, for example, we had a longer drought and that had an effect on the price of food and energy”.
Source: CNN Brasil
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