Economics
Climate-Focused ECB Strategy Starts to Find Focus
- ECB is zooming in on risk of holding carbon-intensive bonds
- Strategy review is seeking valid ways to fight climate change
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The European Central Bank is looking for ways to favor environmentally friendly bonds in its monetary policy, in a fresh bid to intensify its fight against climate change.
While “green QE” -- buying environmentally friendly bonds for political reasons -- is a non-starter, officials are focusing instead on less controversial options. A key part of that is recognizing that purchasing carbon-intensive securities comes at a risk to the institution itself.