policy. a thorough risk assessment is essential for protecting central banks ’ own balance sheets. besides, central banks can act as catalysts, linking the eligibility of assets to climate - related reporting. they could consider buying securities only from issuers that do fulfil proper disclosure requirements. tougher reporting requirements could boost the availability of data relevant to climate - related risk assessment. this would help the market to better price in climate risk. 4 conclusion ladies and gentlemen, just like japan, germany and the eu are committed to the goal of climate neutrality by 2050. therefore, markets needs to price in climate risk adequately. here transparency and disclosure are essential. 2 / 3 bis central bankers'speeches climate change cannot and will not wait, which is why we must act now. it is worth our joint effort. 3 / 3 bis central bankers'speeches

a way of increasing accommodation in a period when the policy rate is at or near the zero lower bound. some models suggest that when you are at the zero lower bound, it can be desirable, or optimal, to indicate that future policy rates will be kept “ lower for longer ” than might otherwise be the case. thus, policymakers intentionally commit to deviating from what they would otherwise choose to do in normal times, such as following the taylor rule. in these models, such a commitment would tend to raise inflation expectations and lower long - term nominal rates, thereby inducing households and businesses to spend more today. this approach asks more of forward guidance than just articulating a reaction function. it takes more credibility and commitment because it requires policymakers to directly influence and manage the public ’ s beliefs about the future policy path in ways that are different from how they may have behaved in the past. as i have indicated in previous speeches, this bis central bankers ’ speeches approach to forward guidance can backfire if the policy is misunderstood. 1 for example, if the public hears that the policy rate will be lower for longer, it may interpret this news as policymakers saying that they expect the economy to be weaker for longer. if that is the interpretation of the message, then the forward guidance will not succeed and may even weaken current spending. the fomc has not been clear about the purpose of its forward guidance. is it purely a transparency device, or is it a way to commit to a more accommodative future policy stance to add more accommodation today? this lack of clarity makes it difficult to communicate the stance of policy and the conditionality of policy on the state of the economy. note that most formulations of standard, simple policy rules suggest that the federal funds rate should rise very soon – if not already. in other words, the zero lower bound no longer appears to be binding. however, the fomc has provided forward guidance indicating that the federal funds rate will need to be low for some time to come. how do we reconcile this apparent incongruity? it could be that the fomc is using its forward guidance as a commitment device or signal for a more accommodative policy well into the future, as in the second approach i have discussed. or, it could be the fomc views forward guidance as a device for increased transparency but that it doesn ’ t think the standard rules apply in the current environment. then what rules do apply