The Network for Greening the Financial System has published a report on the macroeconomic and financial effects of extreme weather events, based on 31 case studies across 28 countries between 2015 and 2025. The report finds that these shocks can materially affect economic and financial systems through multiple transmission channels, with estimated annual GDP impacts ranging from 0.03% to 57% and inflation effects reaching up to 17 percentage points in some cases. The evidence base was compiled from NGFS members and observers and covers advanced, emerging and developing economies, including small island states, across hazards such as floods, droughts, storms, cyclones and wildfires. The case studies show consistent effects on output, employment and prices, and highlight international spillovers through trade, global value and supply chains, and financial linkages. The report describes the exercise as a first step toward better measurement of the economic and financial consequences of extreme weather and notes that forward-looking risk management will be needed as both acute and chronic physical risks are expected to increase over time.
Network for Greening the Financial System2026-05-19
Network for Greening the Financial System publishes cross country report on extreme weather impacts with GDP losses up to 57%
The Network for Greening the Financial System has published a report on the macroeconomic and financial effects of extreme weather, drawing on 31 case studies across 28 countries. It finds such shocks can materially affect output, employment, prices and financial systems, with annual GDP impacts ranging from 0.03% to 57% and inflation effects up to 17 percentage points, and identifies spillovers through trade, supply chains and financial linkages. The report is described as a first step toward better measurement of these effects and stresses the need for forward-looking risk management as physical risks increase.