RBI warns that climate change can increase inflation and hinder growth by causing frequent shocks to the economy.

RBI warns that climate change can increase inflation and hinder growth by causing frequent shocks to inflation. It affects inflation through extreme weather events disrupting agriculture and global supply chains, alters natural interest rates, reducing productivity, and hinders monetary policy effectiveness in influencing financing for households and firms. Climate change shocks can weaken policy transmission, necessitating tighter monetary policy.

April 07, 2024
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