Central Bankers Bow to Political Winds on Climate, Study Shows

Central bank independence is about more than just interest rates.

According to researchers at University of California, Berkeley, and University College London, central bank policy on climate topics is closely correlated with— and influenced by — national politics. In fact, national politics weigh more heavily than science and financial data, they found.

“We find limited evidence that climate-related economic risks are associated with central bank behavior,” Esther Shears, deputy chief economist at the State of California’s Division of Petroleum Market Oversight, said in an interview.

Shears, who co-authored the study on central bank approaches to climate risk management ...