Climate risk and the Fed: Preparing for an uncertain certainty

Mary C. Daly, president and CEO of the Federal Reserve Bank of San Francisco, discussed how the Federal Reserve is preparing to meet the challenges of a changing climate. Extreme weather, rising temperatures, unpredictable rainfall, and other climate phenomena will impose poorly understood costs on the US economy. The magnitude of these costs will depend not only on the frequency and severity of climate-related disruptions but on the speed and scale of societal response. In her most extensive remarks to date on the topic, Daly unpacked these emerging risks, discussed their potential impact on the Fed's dual mandate, and shared how the Fed is working to address them.