Dear Readers,

Climate change is advancing rapidly, with 2024 the warmest year on record. The consequences of climate change are making themselves increasingly felt in Germany, Europe and worldwide. Recent years have seen the international community attempt to curb greenhouse gas emissions and prepare for the impacts of climate change. However, some efforts at the global level have tailed off lately. Yet the scientific consensus is clear: the world needs to take further steps to combat climate change. International cooperation is a must. 

Central banks are working together closely and are focusing intently on the impacts of climate change and climate policy on the economy and the financial system. The Bundesbank, for example, plays a leading role in the Network for Greening the Financial System (NGFS), one of whose tasks is to analyse how climate change and climate policy affect price developments, the growth outlook and financial stability.

We also work at the Eurosystem level to ensure that climate-related risks are sufficiently captured, considered and disclosed. Our annual climate-related disclosures, which we are publishing for the fourth year, include information on our financial investments, thus ensuring that we set a good example when it comes to transparency. This report also presents some of the Bundesbank’s current analyses and research findings. Studying the impact of climate change through an academic lens makes an important contribution to fact-based climate policy. 

I would like to thank everyone at the Bundesbank who is working towards better understanding climate-related risks and what this means for the economy and the financial system. Their commitment and expertise are key to our handling of one of the greatest challenges of the 21st century. 

Sabine Mauderer
First Deputy Governor of the Deutsche Bundesbank