Climate change – through both physical impacts and the effects of economies transitioning to net zero – poses financial risks in both the short and long term. These risks are relevant to a wide range of institutions across the financial system. This includes the Bank of England, given its significant financial operations. However, these risks are challenging to quantify, which could limit financial institutions’ abilities to mitigate against these risks into the future. This article explores how central banks and financial institutions can use scenario analysis to quantify these risks […]