| Description |
1 online resource (26 pages) : illustrations |
| Series |
Discussion paper series, 0265-8003 ; no. 13576 Public economics Financial economics Monetary economics and fluctuations |
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Discussion paper (Centre for Economic Policy Research (Great Britain)) ; no. 13576.
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| Summary |
Central banks look at climate related risks at the financial stability side. Should they also take carbon intensity of assets into account at the monetary policy side? After reviewing the central bank mandate, the paper proposes a tilting approach to steer the Eurosystem's asset and collateral framework towards low carbon assets. We find that a modest tilting approach could reduce carbon emissions in the Eurosystem's corporate and bank bond portfolio by over 40 per cent. It could also lower the cost of capital of low carbon companies in comparison with high carbon companies by 4 basis points. Our findings suggest that such a low carbon allocation can be done without undue interference with the transmission mechanism of monetary policy. Price stability, the primary objective, is, and should remain, the priority of the Eurosystem |
| Notes |
"Published 08 March 2019." |
|
"Submitted 04 March 2019." |
| Bibliography |
Includes bibliographical references (pages 23-24) |
| Notes |
Online resource; title from http://www.cepr.org/active/publications/discussion_papers/dp.php?dpno=13576 viewed March 14, 2019 |
| Subject |
Banks and banking, Central.
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Monetary policy.
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Finance -- Environmental aspects
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Banks and banking, Central.
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Monetary policy.
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| Form |
Electronic book
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| Author |
Centre for Economic Policy Research (Great Britain), publisher.
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