Important Speech by Guy Debelle, Reserve Bank of Australia on climate change and the economy

Not many central bankers have yet tested the (rising) waters by speaking about monetary policy in the context of climate change. Benoit Coeure, ECB, made some references in November 2018, mostly in relation to ECB operations. That speech is available here: https://www.ecb.europa.eu/press/key/date/2018/html/ecb.sp181108.en.html.

But Guy Debelle – Senior Deputy Governor of the RBA – has put the topic firmly on the central banking map with a great speech covering the ground comprehensively. Its available at the following link https://www.rba.gov.au/speeches/2019/sp-dg-2019-03-12.html

What makes this a particularly important intervention is that some in Australia, particularly the vested interests of the coal industry, would treat climate concerns as a political issue, in order to resist the necessary changes. But APRA and RBA are showing that it is a mainstream economic and financial risk issue that the relevant authorities need to tackle, consistent with their existing remits.

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