according to Charles Schwab chief global investment strategist Jeffrey Kleintop.
which in some cases could not traverse the drained rivers. In France, th Rhone river has been too hot to cool down the nuclear reactors for Electricite de France, which has led to shutdowns and lower power output. "If these impacts continue to threaten agriculture, energy, and lives, or worsen — as forecasters expect — the economic impact could be significant for both inflation and economic activity," Kleintop said inHigher energy prices could be exacerbated by low water levers in reservoirs due to extreme heat, which would curtail hydropower generation and put an additional strain on power supplies, putting upward price pressure on energy alternatives like coal and natural gas.
All of this potential inflation in energy and food costs, caused by extreme weather events, could force central banks to keep interest rates higher for longer to combat inflation.