and animal and plant extinction. in the form of disasters that threaten lives and livelihoods. nature and climate have gone rogue – in spain and in the netherlands, in europe and in the rest of the world. but - hope is the thing with feathers. 1 / 3 bis - central bankers'speeches to turn the tide, europe needs the green transition. sooner rather than later. but, of course, that costs money. the european commission estimates that a yearly additional investment of 350 billion euros is needed to meet the 2030 emissions - reduction target in energy systems. another estimated 130 billion euros is needed for other environmental goals ( refers to an external site ). in total, we are talking about 480 billion euros a year. both in terms of type of investment as in the sheer number, this is simply too much for the public sector alone. we need private investment. like equity financing. because more than debt financing, it is equity financing that will increase investments in green and innovative projects. because of the greater riskappetite of equity investors and their longer term investment horizon ( refers to an external site ). currently, however, european smes are heavily reliant on own funds and bank loans for their green and innovative projects. in the us, for example, they would be able to turn to venture capital. but that kind of market for risky investments doesn't exist here – at least not to the same degree ( refers to an external site ). as a result, successful, green, innovative companies lack funding for substantial growth. enter – indeed – a capital markets union. this would allow for a proper allocation of the necessary private investment for the green transition ( refers to an external site ). it would sustain investment flows. and it would strengthen our resilience to nature - and climate - related shocks. and this also works the other way around. today, sustainable finance products account for a small share of the euro area capital markets. but that share is growing. and that offers a leverage to foster a european capital markets union. because, compared to the aggregate bond market, the green bond market has a lower home bias. it shows a higher degree of integration. and euro area green bonds are held cross - border twice as likely as other bonds. green investment funds also have a more stable and committed investor base. and so, if green capital markets were to deepen further, sustainable finance could help advance financial integration in the european union. and remove the legal impedime

disruptions. the global shortage of semiconductors and other manufacturing inputs, as well as shipping and other transportation bottlenecks, are affecting production and delaying deliveries of many goods. while we highlighted some of these problems in our july mpr, they are more widespread and look to be more persistent than we anticipated. quantifying the impact of these supply factors is difficult, but the implication is that there is likely less excess supply in the economy than we thought there would be. we now expect the output gap to close sometime in the middle quarters of 2022, which is earlier than we projected in july. let me underline there is more uncertainty than normal around the economy ’ s productive capacity due to the unusual circumstances of the pandemic. the combination of on - going supply disruptions and related cost pressures, as well as higher energy prices, is putting upward pressure on many prices around the world. in canada, inflation is currently running at about 4½ percent. we now expect it will rise to close to 5 percent by the end of this year, before coming back down to around the 2 percent target by the end of next year. in other words, we continue to expect that inflation will ease back, but relative to our july forecast, it is higher for longer. we know higher prices are challenging for canadians, making it harder for them to cover their bills. i want to assure you that inflation is not going to stay as high as it is today, even if it is going to take somewhat longer to come down. the bank of canada is committed to ensuring that price increases don ’ t become ongoing inflation. so far, measures of medium - to longer - term inflation expectations remain well anchored on the 2 percent target, and overall wage pressures remain moderate. this suggests that higher prices are not becoming embedded in expectations of ongoing inflation. as these forces play out, it is our job to bring inflation back to target, and i can assure you we will do that. in view of the continued excess capacity in the economy, my fellow governing council members and i judged that the economy still needs considerable monetary policy support. while we ended qe, we kept our policy interest rate at its lowest level, and reaffirmed our commitment to keep it there until slack in the economy is absorbed so that the 2 percent inflation target is sustainably achieved. based on our current projection, this happens sometime in the middle quarters of 2022. let me conclude with some additional information on the end of q