This gap also reflects the limited pass-through of our policy decisions in stressed countries: the 75 basis point reduction in MRO between the third quarter of 2011 and the first quarter of 2013 brought about a 100 basis point reduction in the average cost of borrowing for non-financial corporations in Germany but only a 50 basis point reduction in Italy.8 Within countries, our interest rate cuts have also benefited different firms to different extents, increasing the heterogeneity of borrowing costs.
The topic of this workshop is climate-related financial risks, that is, the risks that climate change might destabilize the financial system through a variety of channels. This workshop is the first event held by the Bank of Japan on how climate change interacts with the economy and the financial system.