💨 Abstract

The Reserve Bank of India's deputy governor, Michael Patra, warns that climate change and digitalization could jeopardize central banks' ability to maintain inflation-targetting monetary policy in the future. Climate change could lead to supply shocks and decreased productive capacity, while digitalization might shift credit supply away from banks. Depreciation pressures on currencies of climate-disaster-prone countries could cause financial instability and higher import costs.

Courtesy: theprint.in

Summarized by Einstein Beta 🤖