How green is my central bank

Green climate and other bonds, and fixed-income assets do offer an explicit and ex-ante guarantee of carbon neutrality

The Bank of Finland has announced that its investment portfolio will be carbon-neutral by 2050. Reading up, I found many western central banks making similar announcements.

Puzzling. A central bank holds most of its investment portfolio in gold, and national and foreign cash and sovereign bonds. How would one judge whether bonds and cash assets were carbon-neutral? Gold, bizarrely, was excluded from the calculus of carbon neutrality apparently because there was no method to judge this. I find it inconceivable that gold mining is carbon-neutral, but let that pass.

The literature on the subject, putting it politely, completely misses basic tenets of