It acknowledges, of course, that monetary policy is not the primary tool for tackling climate change but rather plays a supplementary role alongside fiscal, environmental and structural policies. Decarbonising the energy system and financing the transition to a low-carbon economy, consistent with the “well below 2 Celsius degrees” goal set out in the Paris Climate Agreement, are among the major challenges of our time.
Climate change and global warming are linked to anthropogenic activity, in particular the use of fossil fuels and carbon emissions. Current and future impact on society and sustainable development is such that renders the use of fossil fuels prohibitive.