Climate Change Is Already Showing Up in the Cost of Living
Economists and central bankers are getting better at linking temperatures to price increases.
Illustration: Bryson Lee For Bloomberg
In the summer of 2022, a heatwave in Europe drove temperatures to a record-breaking 46C (115F) in Spain, scorching its olive-growing regions. In the UK, chickens wilted in the heat, leading to a 9% drop in chicken-meat production from the year before. Northern Italy, meanwhile, endured its worst drought in 70 years, slashing harvests of risotto rice.
Researchers calculated that climate change increased summer temperatures in Europe by 1.25C on average — and by as much as 5.7C in some places. The extreme heat raised European food prices by an estimated 0.7% that year, nudging overall inflation up by about 0.3% and adding to the pain of spikes related to the Covid-19 recovery and Russia’s full-scale invasion of Ukraine.