situation appears even more challenging than for climate change, and this calls for further action. another challenge is the fact that there is no single metric capturing the breath and width of biodiversity. the lack of a single metric has been prompting researchers to focus on specific aspects of nature. bundesbank researchers, for example, have been zooming in on the macroeconomic consequences of water stress events – a highly relevant phenomenon that is getting worse. 5 the bundesbank research focusses on water as a transport medium. waterways normally offer a cost - efficient way to transport goods. droughts, however, can seriously disrupt or even halt shipments and, in return, affect supply chains and hence prices and production. our researchers are now assessing the macroeconomic relevance of low water levels of the rhine, europe's most important waterway. looking at 30 years of data, they show that germany's overall producer price index – which encompasses thousands of product lines – tends to rise in the months with low rhine levels. their preliminary results are statistically and economically significant and hence relevant to inflation watchers. 4 conclusion let me sum up. climate change is a reality – so is the loss of biodiversity! they affect our economies, communities and lives. there will be no stable climate without a healthy natural world. central banks and supervisors hence need to consider both – climate change and biodiversity loss. that said, more research on the transmission channels of climate change and biodiversity loss is required. if central banks do not fully understand the channels through which climate change and biodiversity loss affect the real economy [ and thus their mandate ], they will find it hard to do their job properly. that is a key reason why the bundesbank is dedicating this year's conference to climate change and central banks – and is addressing nature - related risks. we aim to encourage networking and knowledge sharing between the academic community and central banks. it will help us to better understand each other's considerations and concerns and underpin the evidence - based foundations of the eurosystem's monetary policy. so, please make the most of the next two days. and enjoy the spring weather. 3 / 4 bis - central bankers'speeches 1spain bakes in summer - like heat, and worries about what comes next - the new york times ( nytimes. com ) 2 https : / / www. munichre. com / en / risks / natural - disasters. html 3 why the crisis engulfing nature matters for business and

##p, the so called “ six pack ”, and bis central bankers ’ speeches the fiscal compact. but given past experience, rigorous implementation of the new rules is crucial. germany has set an example by introducing a national debt brake in 2009. it now has to set an example by actually sticking to these new rules. finally, we have to further increase the resilience of the financial system. this is surely one of the global lessons we have learned from the financial crisis, but it is especially important in the context of the euro area, where contagion spread primarily through the financial system. therefore, it is essential to ensure that agreed financial reforms are implemented rigorously, in a timely manner and in a way which promotes consistent results. we must not lose momentum in completing the first round of financial regulatory reform since the start of the financial crisis, and i am glad that this is one of the priorities of the mexican g20 presidency. it goes without saying, however, that financial regulatory reforms will – by their very nature – never be definitive or conclusive. 5. conclusion ladies and gentlemen, let me sum up the main points of my speech. i talked about two peculiarities of emu that contributed to the sovereign debt crisis – the most important one being the combination of a single monetary policy and national fiscal policies. i argued that higher “ walls of money ” can buy time, but that time must be used to tackle the roots of the crisis. this includes consolidation of public finances, structural reforms and better rules at the european level. germany has been a stability anchor in containing the crisis by supporting the various rescue mechanisms, but the conviction that tackling the structural causes of the crisis is both indispensable and holds out the promise of success has been the essence of the german position throughout the crisis. in this regard, we have seen some progress over recent months. nevertheless, success depends on rigorous implementation of the agreed measures and rules. personally, i am confident that, by following this course, we will eventually contain the crisis and that the euro will remain a stable currency. bis central bankers ’ speeches