Thursday, June 8, 2023
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Climate activists press Fed at Jackson Hole meeting

by Ann Saphir

Jackson, Wyoming. (Reuters) – Climate activists will stage a colorful series of protests at the U.S. Federal Reserve’s annual Jackson Hole central bank meeting that begins on Thursday in an effort to pressure the central bank to tackle climate change and wean the U.S. economy off fossil fuels.

“Our presence will remind the Fed that real people are suffering the real economic impacts of the climate crisis, and that this very real human cost must be reflected in the Fed’s actions going forward,” Climate Group

.org organizer Emily Park said.

Central bankers from around the world attending this year’s Jackson Hole Economic Symposium are expected to discuss academic papers and challenges around policy constraints when dealing with high inflation. The level of concern about climate risk is unclear.

Demands from climate activists include asking banks to measure their vulnerability to natural disasters and potential disruptions associated with the green energy transition faster.

But the demands also go beyond what Fed policymakers say they do, such as requiring banks that lend to oil and gas companies to tie up more capital to prevent the transition away from fossil fuels When losses are more devastating than expected.

Park said the actions she hoped — including people holding signs calling for a fossil-free Federal Reserve Bank on the way from Jackson’s airport to Grand Teton National Park, where the conference took place — would give Federal Reserve Chairman Jerome Powell and other policymakers left behind on the need to focus on environmental threats.

The Federal Reserve has long been reluctant to get involved in climate issues, a hot political issue in the United States. For example, it was the last major central bank to join the green financial system network. Peers such as the Bank of England and the European Central Bank conduct annual climate stress tests for banks under their jurisdiction.

Instead, it focuses on understanding climate change and transitioning from fossil fuels to the economy. But the Fed has largely ruled out a more active role in driving green energy investment, as the European Central Bank has begun to do, and as activists hope.

This is in line with many Republican members of Congress who oppose central banks taking an active role in mitigating climate risks. Activists and some Democrats believe that stance should at least be considered. The Fed is accountable to Congress.

The Federal Reserve has two internal groups and works with U.S. regulators to study potential vulnerabilities in the banking industry and the larger financial system.

Powell also said the Fed is exploring how banks can respond to climate risks such as rising temperatures and weather disasters, including developing climate stress scenarios that other central banks are already using.

Powell has said any focus on climate would be consistent with the Fed’s mandate to maximize employment and price stability.



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