Heatwaves 'clearly' harm medium-term growth, says Bank of France governor

Repeated heatwaves are having a clear negative impact on medium-term economic growth, stated Emmanuel Moulin, the new governor of the Bank of France. Speaking on France Inter, Moulin acknowledged that the short-term effects are somewhat ambiguous, potentially influencing productivity while increasing energy consumption for air conditioning. He linked these extreme weather events, including fires and floods, to climate change, which he described as a significant risk for both the Bank of France and the European Central Bank. "It particularly affects the financial sector, as it impacts the assets and balance sheets of banks, as well as insurance companies," Moulin explained. He emphasized that Europe is facing substantial shocks from energy issues and exceptional climate events. Therefore, Moulin asserted, continued investment in decarbonization and adaptation is crucial. "The financial sector must contribute to this, and that includes the private sector. It's not just public money that needs to be mobilized," he added, highlighting the shared responsibility in addressing these challenges.