Changes in climate and subsequent policy responses could increase volatility of food and energy prices, resulting in higher headline inflation rates. Thus, Central Banks  have to pay careful attention to underlying inflationary factors to maintain their inflationary targets. In response, CBs can take a number of actions. For example, they could require that collateral comprises assets that support the move to low-carbon economy, or their refinancing operations and crisis facilities could incentivise borrowers' move to low-carbon activities, particularly in countries where CBs' mandate has been expanded to account for climate impact . Other actions that CBs could take include adoption of sustainable and responsible investment principles  and requiring financial firms to disclose their climate-related risks . Despite these opportunities, there is ongoing debate regarding whether CBs should actively use monetary policy to address climate change and its risks .
IPCC
Climate Change 2022: Impacts, Adaptation and Vulnerability
IPCC Report