The Chief of the European Central Bank said Thursday that climate change needs to be taken into account when making decisions on inflation.
ECB Chief Christine Lagarde made the comments in conversation with Madame Figaro, a French outlet. “If more and more climate disasters, droughts and famines occur throughout the world, there will be repercussions on prices, on insurance premiums and on the financial sector,” Lagarde told the French outlet in a translation provided by the ECB. “We need to take that into account.”
Lagarde argued that our species is “at a watershed moment triggered by the war in Ukraine. The horrific violence inflicted on the families on the ground has considerably raised awareness and has led us to review a number of priorities — especially as regards the fight against climate change, the need to speed up the transition to non-fossil and renewable energy sources.”
ECB’S CHRISTINE LAGARDE, IN INTERVIEW WITH MADAME FIGARO: WE CAN NO LONGER RELY EXCLUSIVELY ON THE PROJECTIONS PROVIDED BY OUR MODELS – THEY HAVE REPEATEDLY HAD TO BE REVISED UPWARDS OVER THESE PAST TWO YEARS
— *Walter Bloomberg (@DeItaone) August 25, 2022
Lagarde further stated that those who work in finance and the economy can no longer rely on projections provided by models as these systems have consistently needed upward revision over the last two years, according the ECB translation of the interview. (RELATED: A Host Of Cartoonish Bond Villains Are Deciding Your Fate From The Swiss Alps)
The comment came after Lagarde was asked whether she feels any weight of the responsibility for her decisions having a direct, negative impact on the lives of Europeans. “Yes, absolutely. I still buy my groceries at the supermarket, pay my own bills, including my gas bills, and meet people at the market, as life here at the ECB can be a little removed, disconnected and punctuated with econometric models and projections. I move forwards with a sense of duty and humility,” she responded.