{"id":457161,"date":"2026-06-17T16:46:20","date_gmt":"2026-06-17T14:46:20","guid":{"rendered":"https:\/\/www.eunews.it\/2026\/06\/17\/allarme-bce-da-siccita-e-caldo-estremo-rischi-per-inflazione-e-accesso-al-credito\/"},"modified":"2026-06-17T17:55:45","modified_gmt":"2026-06-17T15:55:45","slug":"ecb-warning-drought-and-extreme-heat-pose-risks-to-inflation-and-access-to-credit","status":"publish","type":"post","link":"https:\/\/www.eunews.it\/en\/2026\/06\/17\/ecb-warning-drought-and-extreme-heat-pose-risks-to-inflation-and-access-to-credit\/","title":{"rendered":"ECB warning: “Drought and extreme heat pose risks to inflation and access to credit”"},"content":{"rendered":"

Brussels – Climate change, with its extreme weather events, is\u2014and will increasingly be\u2014a problem<\/strong>. With inflation at risk of being driven steadily upwards, and by no small margin, and banks potentially ceasing to grant credit, the succession of droughts, fires, floods, and various types of severe weather will increasingly put the eurozone economy under severe strain<\/strong>. This is the warning contained in the thematic studio<\/a> by the European Central Bank on the role of heatwaves and droughts in the EU\u2019s regional economies.<\/span><\/span><\/span><\/p>\n

\n
There is no point looking for projections of the economic fallout; the ECB\u2019s economists do not think in terms of billions of euros lost. This is because, they point out, \u201cdespite their increasing frequency, the economic impacts of droughts and heatwaves remain insufficiently quantified,<\/strong> particularly for advanced economies.” It is of little use and highly misleading to provide figures that are not well-established but merely approximate. It is therefore better to rely on certainties. In this regard, \u201cthe evidence shows that extreme droughts can depress gross domestic product (GDP) growth for several years,<\/strong> with regional output in Europe potentially remaining up to three percentage points (pp) lower four years after a <\/span><\/span><\/span>severe<\/span><\/div>\n

drought event.”<\/p><\/div>\n

 <\/p>\n

Here, then, is a non-economic and non-financial indicator that helps to give an idea of the scale of the phenomenon of climate change. To this, further considerations must be added: \u201cDroughts and poor harvests have substantial inflationary effects,\u201d the ECB\u2019s economists continue. Specifically, \u201ccrop shocks account for around 30 per cent of medium-term inflation volatility in the euro area<\/strong>, and a single crop shock can cause food prices to rise by double-digit percentages<\/strong>, with persistent inflationary consequences.\u201d<\/span><\/span><\/span><\/div>\n

\n

https:\/\/www.eunews.it\/en\/2026\/06\/16\/climate-refugees-in-2024-the-highest-number-ever-recorded-one-of-the-eus-key-political-issues-resurfaces\/ <\/p>\n

The European Central Bank is once again emphasising the importance of the issue of food inflation<\/a>, which is increasingly linked to extreme weather. But there is more: as well as agriculture, “the disruptions caused by drought in river transport, electricity generation, water-dependent manufacturing,<\/strong> and tourism are spreading further through production networks and supply chains, driving up costs and limiting output<\/strong>.\u201d Hence, the risk of stagflationary pressures (high inflation and low growth) for EU countries using the single currency. <\/span><\/span> <\/span><\/div>\n

\n

 <\/p>\n

All these factors \u201cmay also affect financial institutions<\/strong> through increased credit risk, a reduction in the value of collateral, operational disruptions and market volatility,\u201d warn Eurotowter\u2019s analysts. There is a risk of a slowdown in lending to businesses, with repercussions for production, competitiveness, and growth. Moreover, risks linked to natural factors, particularly water scarcity, are increasingly recognised as dominant transmission channels for the euro area economy and its banking sector.<\/span><\/span> <\/span><\/div>\n

\n

 <\/p>\n

“Over 40 per cent of bank loans are concentrated in businesses highly exposed to drought<\/strong> and dependent on surface water supplies, with particularly high levels of exposure in southern and western Europe,” notes the recently published special study. Southern Europe refers to the Mediterranean basin and also includes Italy, which is explicitly mentioned. \u201cThe data show that most European regions have recorded an increase in the average annual number of days with heatwaves\u201d during the hottest months (May\u2013September). \u201cThe largest increases were observed in the Spanish Mediterranean region, in southern Italy and across northern and eastern Europe.\u201d <\/span><\/span><\/span><\/p>\n
Given the current situation and outlook, the implicit advice to governments is to work towards measures to counter and mitigate risks to safeguard agricultural production, inflation, and access to credit. Otherwise, the EU and its eurozone will be facing an uncertain and far from rosy future. However, to resolve this problem, data must be collected and the information gap bridged\u2014one that currently makes it impossible to calculate the real impact of droughts, extreme heat, wildfires, floods, and the wider consequences of climate change.<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

A thematic study by the European Central Bank warns of extreme weather events caused by climate change: “A single crop shock can cause food prices to rise by double-digit figures, with persistent inflationary consequences”<\/p>\n","protected":false},"author":494,"featured_media":457121,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"episode_type":"","audio_file":"","podmotor_file_id":"","podmotor_episode_id":"","cover_image":"","cover_image_id":"","duration":"","filesize":"","filesize_raw":"","date_recorded":"","explicit":"","block":"","jnews-multi-image_gallery":[],"jnews_single_post":{"format":"standard","override":[{"template":"1","parallax":"1","fullscreen":"1","layout":"right-sidebar","sidebar":"default-sidebar","second_sidebar":"default-sidebar","sticky_sidebar":"1","share_position":"top","share_float_style":"share-monocrhome","show_featured":"1","show_post_meta":"1","show_post_author":"1","show_post_author_image":"1","show_post_date":"1","post_date_format":"default","post_date_format_custom":"Y\/m\/d","show_post_category":"1","show_post_reading_time":"0","post_reading_time_wpm":"300","post_calculate_word_method":"str_word_count","show_zoom_button":"0","zoom_button_out_step":"2","zoom_button_in_step":"3","show_post_tag":"1","show_prev_next_post":"1","show_popup_post":"1","show_comment_section":"1","number_popup_post":"1","show_author_box":"0","show_post_related":"1","show_inline_post_related":"0"}],"image_override":[{"single_post_thumbnail_size":"crop-500","single_post_gallery_size":"crop-500"}],"trending_post_position":"meta","trending_post_label":"Trending","sponsored_post_label":"Sponsored by","disable_ad":"0","subtitle":""},"jnews_primary_category":[],"jnews_override_counter":{"view_counter_number":"0","share_counter_number":"0","like_counter_number":"0","dislike_counter_number":"0"},"footnotes":""},"categories":[25705],"tags":[26180,25826,26112,26050,27203,26950,26151,25828,27237,26949,26107],"class_list":["post-457161","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-banche-en","tag-bce-en","tag-climate-en","tag-changes-climate-en","tag-drought-en","tag-bank-central-en-en","tag-eurozone-en","tag-floods-and","tag-incendi-en","tag-inflation-en"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.eunews.it\/en\/wp-json\/wp\/v2\/posts\/457161","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.eunews.it\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.eunews.it\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.eunews.it\/en\/wp-json\/wp\/v2\/users\/494"}],"replies":[{"embeddable":true,"href":"https:\/\/www.eunews.it\/en\/wp-json\/wp\/v2\/comments?post=457161"}],"version-history":[{"count":1,"href":"https:\/\/www.eunews.it\/en\/wp-json\/wp\/v2\/posts\/457161\/revisions"}],"predecessor-version":[{"id":457162,"href":"https:\/\/www.eunews.it\/en\/wp-json\/wp\/v2\/posts\/457161\/revisions\/457162"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.eunews.it\/en\/wp-json\/wp\/v2\/media\/457121"}],"wp:attachment":[{"href":"https:\/\/www.eunews.it\/en\/wp-json\/wp\/v2\/media?parent=457161"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.eunews.it\/en\/wp-json\/wp\/v2\/categories?post=457161"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.eunews.it\/en\/wp-json\/wp\/v2\/tags?post=457161"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}