Green central banking in times of climate uncertainty

While central banks, financial supervisors and regulators have traditionally been concerned with strictly monetary and financial issues, in the last two decades there has been increasing attention on including environmental and climate-related issues in the activities of these institutions. This chapter presents the academic debate and actual measures implemented by these institutions in the past two decades. The aim of the analysis is twofold. On the one hand, it shows how and to what extent central banks are increasingly considered important actors in promoting policies that enable a green economic agenda. On the other hand, since climate change and its effects on an economy are expected to generate new risks for financial markets, it highlights the new policy tools that central banks and financial regulators need to consider.