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Sterling Continues to be Pounded

Overview: Sterling’s pounding continued in Asia where it was driven to $1.0350, a new record low before stabilizing. UK rates also continued to rise…



Overview: Sterling’s pounding continued in Asia where it was driven to $1.0350, a new record low before stabilizing. UK rates also continued to rise sharply after the new government promised more tax cuts next year. The right-wing victory in Italy was not surprising but it kept pressure on Italian bonds. China took more action to slow the yuan’s descent The dollar is broadly higher. All the G10 currencies and most emerging market currencies are lower. Risk appetites are practically non-existent today. Many of the largest Asian equity markets, excluding China, were off 1.5%-3% Europe’s Stoxx 600 is off around 0.8% to bring it to new lows for the year. US futures off almost 1% UK’s 10-year Gilt yield is soaring by more than 30 bp, while European benchmark yields are 9-16 bp higher, with Italy’s gains the most following the right-wing election victory. The 10-year US Treasury yield is near 3.78%. Gold slipped through $1627 to record new lows for the year today but has rebounded in the European morning to test previous support, now resistance near $1650. Concerns about demand saw December WTI fall to $76.75, new lows since January. Separately, retail gasoline prices have begun stabilizing after falling for most of Q3. They rose on Saturday for the fifth consecutive daily gain US natgas is off 2.3%, after falling 12% last week (fifth weekly loss) Europe’s benchmark is off 6.3%. It fell nearly 3.5% last week (fourth consecutive weekly decline). Iron ore fell by about 2.25% today It was practically flat last week. December copper is heavy after falling 3.7% before the weekend. It is near three-month lows. December wheat is nearly 1.4% lighter today It fell 3.3% before the weekend to trim last week’s gain to 2.4%. 

Asia Pacific

The Bank of Japan acted on two fronts last week. First, it intervened and bought yen for the first time since 1998. With the yen still confined to the range seen on the intervention day, Japanese officials see the action as successful. Second, rising global yield pressured Japanese government bonds, and the BOJ stepped in for the first time since June to buy 10-year JGBs in an unannounced operation. The BOJ has come to dominate the market that there were two days last week when the 10-year cash bond did not trade. The BOJ stepped in today and bought JPY550 bln (~$3.8 bln) of 5–10-year notes today. It is the third operation for more than the plan of JPY500 bln and it follows an unscheduled purchase of JPY150 bln in the middle of last week. Separately, due to a holiday at the end of last week, Japan's preliminary PMI was reported earlier today. The manufacturing PMI softened to 51.0 from 51.5, but the services PMI rose to 51.9 from 49.5. The saw the composite recover to 50.9 from 49.4, which was its lowest reading since February

Beijing took another step to ease the selling pressure on the yuan. It imposed a 20% reserve requirement on short yuan forward positions Previously there were no requirements. The measure goes into effect Wednesday. The reserve requirement had been eliminated in October 2020 as the yuan strengthened Recall on September 5, Beijing cut the reserve requirement on foreign currency deposits by 2% to 6%. The dollar is allowed to trade in a 2% band around the fix. Most of the time, the greenback trades well within it. However, in recent days, it has approached the limit. Speculation that it may widen the band seems to be confused .A wider band now would accelerate the dollar's rise

Today, the PBOC set the dollar's reference rate at CNY7.0298. The upper band, 2% higher, would give CNY7.17. Today's high has been about CNY7.1685. The offshore yuan (CNH) often respects the onshore band, but today the dollar traded through it to around CNH7.1735. The dollar gapped higher Friday's high was slightly below CNY7.13 Today's lows were near CNY7.1360. The dollar remains in the intervention day range against the Japanese yen (~JPY140.35-JPY145.90. However, it did reach its best level since then and set a high near JPY144.25. Support now is seen in the JPY143.00-25 area. After the weak close before the weekend, the Australian dollar was sold further today, reaching $0.6485, a new two-and-a-half year low. The (61.8%) retracement objective of the rally since the March 2020 low (~$0.5510) comes in near $0.6465, which we have suggested as near-term target. Resistance now is seen around $0.6550. Lastly, we note that South Korean officials have stepped up their rhetoric, expressing displeasure with the won's weakness. There had been some idea that it was defending the KRW1400 level, around where it is stalling in the middle of the month. However, it closed above in the last two sessions last week, and gapped higher today, reaching KRW1435


Sterling slumped to $1.0350 in early Asian turnover as the market continued to react to the government's "mini-budget". The government seems undaunted by the criticism of economists and investors Chancellor of the Exchequer Kwarteng signaled more tax cuts were planned for next year. The main focus of the criticisms, leaving aside the regressive nature of many of the initiatives, has been on the risk to the twin deficits To attract funds, prices are being marked down, which is to say higher yields and weaker sterling. There is also the fear that the government's plans will be inflationary. The 10-year breakeven is around 4.30%, up from less than 4.10% a week ago. The market is rife with speculation of an emergency Bank of England meeting this week that would ostensibly hike rates. The swaps market is pricing in 110 bp increase in the policy rate by early November The BOE meets on November 3. This is up from around 75 bp after last week's BOE meeting. The 10-year yield was near 3.50% after the BOE meeting and surged to 3.85% before the weekend and traded to almost 4.20% today before steadying

As widely expected, a right-wing coalition won handily in Italy. It will take a little time to sort things out President Mattarella is expected to recognize the election results and allow the Brothers of Italy to put together the new government. Ministerial appointments are focus Still, it does not look as if the right secured a sufficient majority to enact constitutional reforms. The 10-year Italian bond yield has jumped about 15 bp to 4.47% and the premium over Germany has risen around six basis points on top of the 11 before the weekend to approach 240 bp, the upper end of this year's range. The two-year premium near 116 bp. That is roughly a 20 bp increase over the past two sessions

The German IFO survey worsened in September. The current assessment fell to 94.5 from 97.5. The expectations component stumbled to 75.2 from 80.5. The in the early days of the pandemic was a little below 72.0. This left the overall assessment of the business climate at 84.3, down from 88.6, where it had been in July and August. The pandemic low was 86.8. Germany is on the verge of a contraction that will likely carry into at least the first part of next year. 

The euro fell to about $0.9550 in Asia and quickly bounced back to $0.9650. It is little changed on the day in late morning turnover in Europe as it hovers a little below $0.9700. The upside may be limited in North America as the intraday momentum indicator is getting stretched. The session high was recorded in early Asian turnover near $0.9710. It may take a move above $0.9750 to stabilize the tone. The lower Bollinger Band (two standard deviation below the 20-day moving average) is around $0.9730. Sterling was pounded to $1.0350 in early Asian turnover and has gradually climbed back to approach $1.08. That effort has also stretched the intraday momentum indicators, even though sterling remains well below its lower Bollinger Band (~$1.0965). The three-standard deviation (from the 20-day moving average) is near $1.0740


Since the FOMC meeting, the market shifted toward a later (Q2 23) and higher (4.50%-5.0%) peak in the Fed funds rate. This shift is not smooth (non-linear) and has injected volatility as the adjustment is made. Meanwhile, a fiscal drama playing out could lead to a shutdown of the Federal government. To ensure passage of the Inflation Protection Act, Senate leader Schumer cut a deal with Manchin to include his bill that changes the approval process for government energy projects in a "must-pass bill."  Schumer chose the continuing resolution bill that needs to be approved this week to keep the government funded. Most Republicans and at least a few Democrats are opposed to Manchin's bill and have threatened to vote against the continuing resolution bill

As the Fed pursues its most aggressive tightening since Volcker and the dollar soars, the fancies of many otherwise grounded observers turn to the possibility of a Plaza-like accord. A similar, or at least parallel argument is that the tightening of the US monetary policy in response to the highest inflation in a generation is a "reverse currency war". While exchange rates, of course, can impact domestic price pressures, the rise in energy and food prices is playing a more significant role. Making the dollar the key driver in the narrative does not do justice to other drivers, including terms-of-trade shock, which helps explain the general outperformance of Latam currencies. 

The major industrialized countries, and yes, despite the trash talk of the UK being an emerging (or submerging, as the FT saw fit to quote Summers' schadenfreude on the front page over the weekend) it is still in this group, did not intervene during the Great Financial Crisis and the Pandemic. The thinking has evolved from defining the problem in terms of price to one of access (hence the swap lines). While Treasury Secretary Yellen does not repeat what had once been the strong dollar mantra, the policy is alive and well and the Fed. There can be no Plaza-like agreement to drive the dollar lower because it is a channel through which financial conditions are tightening. Contrary to allusions to the US "responsibility" for countries that borrow dollars, the Federal Reserve is not the world's central bank. Pursuing a purposeful weaker dollar would contradict the Fed's monetary policy.

There are US economic data every day this week, and with the FOMC meeting behind us, the Federal Reserve officials also are speaking every day. Today's data, the Chicago Fed's national activity index and the Dallas Fed's manufacturing survey are not typically market movers. Tomorrow features durable goods orders, house prices and the Conference Board's measure of consumer confidence. Among Fed officials, Collings, Bostic, Logan, and Mester speak. Tomorrow, Powell (on a panel on digital currencies) speaks, as will Evans, Bullard, Kashkari, and Daly The data highlight in Canada is the July GDP on Thursday. A small contraction is expected Mexico reports its economic surveys today, employment and trade figures will be released before Thursday's central bank meeting, where a 75 bp hike (to 9.25%) is widely expected. Brazil reports its July current account today and inflation readings, but the focus is on the first round of the presidential election October 2. A run-off is expected, and it will be held on October 30

The Canadian dollar remains under pressure. It fell 2.4% last week, its largest weekly loss in three months. The US dollar so far today has reached slightly below CAD1.3640 The (61.8%) retracement of the greenback's decline from the 2020 high (~CAD1.4670) is found near CAD1.3650. A move above there were initially target the CAD1.3700-20 area, but the risk extends toward CAD1.40. The continued losses in US equities are a considerable drag. The Mexican peso succumbed to the dollar's strength in the last two sessions. The dollar has rallied from around MXN19.9060 to MXN20.2620 before the weekend and today has stretched of almost MXN20.37. The greenback has not been this high since August 8 Near-term potential extended toward MXN20.42-MXN20.45



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Spread & Containment

Air pollution can increase the risk of COVID infection and severe disease – a roundup of what we know

Air pollution can increase COVID risk by weakening our immune defences and exacerbating underlying health conditions.




Tatiana Grozetskaya/Shutterstock

The early part of the COVID pandemic led to a significant reduction in air pollution in many parts of the world. With lockdowns, travel restrictions and decreased economic activity, there was a noticeable drop in the emission of air pollutants, such as nitrogen dioxide (NO₂) and particulate matter (PM) that is fine enough to be inhaled.

Changes in air pollution varied depending on the location and the type of pollutant, but reductions were particularly noticeable in cities and industrial areas, where emissions from transport and industrial activities are typically high. In many areas though, air pollution levels quickly increased again as restrictions eased and activity resumed.

Along with having harmful effects on the environment, it’s well established that air pollution can have negative effects on human health, including increasing the risk of respiratory and heart problems and cancers. Emerging research suggests air pollution may also affect the brain and be linked to certain developmental issues in babies. The severity of these health effects can depend on the type and concentration of pollutants, as well as individual factors that affect a person’s susceptibility.

While there has been much focus on the way the pandemic affected air quality, it has also become apparent that air quality affects COVID risk – both in terms of the likelihood of contracting COVID and how sick people get with the infection.

How does air quality increase COVID risk?

Research has shown that long-term exposure to air pollution, particularly fine particulate matter under 2.5 micrometres (PM2.5) and NO₂, may increase the risk of COVID infection, hospitalisation, and death.

A study in England, for example, showed long-term exposure to PM2.5 and NO₂ is associated with 12% and 5% increases in COVID cases, respectively, for every additional microgram of PM2.5 or NO₂ per cubic metre of air.

One of the primary ways that air pollution may increase the risk of COVID is by weakening the respiratory system’s defences against viral infections. We know long-term exposure to fine particulate matter that is inhaled can reduce the lungs’ immune responses and cause damage to them, which can make people more vulnerable to respiratory infections like COVID.

Read more: Long COVID linked to air pollution exposure in young adults – new study

Air pollution can also impact the immune system’s ability to fight off viral infections. Exposure to particulate matter, such as PM2.5, has been linked to increased levels of cytokines and inflammation in the body.

Cytokines are signalling molecules that help the immune system fight infections. But high levels can cause a “cytokine storm”, where the immune system overreacts and attacks healthy cells in addition to the virus. Cytokine storms have been associated with severe COVID and a higher likelihood of dying from the disease.

And notably, COVID binds to ACE2 receptors to enter a cell. In studies of animals, PM2.5 exposure has been linked to a significant increase in ACE2 receptors. PM2.5 may therefore increase the probability of COVID entering cells in humans.

A crowd of people walking a New York street wearing masks.
There are a variety of factors which could explain why air pollution increases COVID risk. blvdone/Shutterstock

Further, air pollution may increase the severity of COVID symptoms by exacerbating underlying health conditions. Exposure to air pollution has been linked to increased rates of conditions such as diabetes and heart disease, which have been identified as risk factors for severe COVID.

Air pollution may also increase COVID transmission rates by acting as a carrier for the virus. Researchers continue to debate the potential of respiratory droplets from infected people attaching to particulate matter in the air and travelling long distances, potentially increasing the virus’s spread.

How can I reduce exposure to air pollutants?

With all this in mind, reducing air pollution levels may be an important strategy for mitigating the impact of COVID and protecting public health.

This requires a combination of individual actions and collective efforts to address the sources of pollution. There are several ways you can decrease your and others’ exposure to air pollution, including:

Limit outdoor activity during high-pollution days. Check air quality forecasts and limit outdoor activities on “high” days. Try to go outside at times of the day when pollution levels are lower, such as early morning or late evening.

Think about your mode of transport. Using public transport, walking or riding a bike instead of driving can help to reduce pollution levels. If you do drive, try to carpool or use an electric or hybrid vehicle.

Read more: Wuhan's lockdown cut air pollution by up to 63% – new research

Use indoor air filters. Having air filters in your home can help reduce indoor pollution levels. Hepa filters can remove many pollutants, including fine particulate matter. Further, the use of Hepa air systems can successfully filter COVID virus particles from the air.

Samuel J. White advises on air quality and receives funding from Fédération Equestre Internationale.

Philippe B. Wilson does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.

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Antisemitism on Twitter has more than doubled since Elon Musk took over the platform – new research

New research shows that antisemitic posts surged as the ‘free speech absolutist’ took over the social media giant. And it has settled at a higher level…



What goes on in the Twitter shadows.

In the days after Elon Musk took over Twitter in October 2022, the social media platform saw a “surge in hateful conduct,” which its then safety chief put down to a “focused, short-term trolling campaign.” New research suggests that when it comes to antisemitism, it was anything but.

Rather, antisemitic tweets have more than doubled over the months since Musk took charge, according to research that I and colleagues at tech firm CASM Technology and the Institute for Strategic Dialogue think tank conducted. Between June and Oct. 26, 2022, the day before Twitter’s acquisition by Musk, there was a weekly average of 6,204 tweets deemed “plausibly antisemitic” – that is, where at least one reasonable interpretation of the tweet falls within the International Holocaust Remembrance Alliance’s definition of the term as “a certain perception of Jews, which may be expressed as hatred towards Jews.”

But from Oct. 27 until Feb 9, 2023, the average was 12,762 – an increase of 105%. In all, a total of 325,739 tweets from 146,516 accounts were labeled as “plausibly antisemitic” over the course of our study, stretching from June 1, 2022 to Feb. 9, 2023.

Finding antisemitism with AI

To identify plausibly antisemitic tweets, my co-authors and I combined 22 published hate speech-identifying algorithms into a single mechanism and used even more machine learning to see which combinations of decisions led to the correct result. We then passed through all tweets – over a million in total – that contained any one of 119 words, phrases, slurs and epithets related to antisemitism.

No such process is perfect. We estimate our model to make a correct decision about 75% of the time. We also no doubt missed some antisemitic tweets not containing any of those 119 key words, as well as those taken down before early December when we collected the data.

We then used an algorithm to draw out 10 different themes of antisemitism seen in the tweets. Some centered around the use of specific antisemitic derogatory epithets. Others alluded to conspiracy theories concerning hidden Jewish influence and control.

Antisemitic tweets directed at Jewish investor and philanthropist George Soros warranted its own category. He was mentioned more than any other person in our data, over 19,000 times, with tweets claiming he was a member of a hidden globalist, Jewish or “Nazi” world order.

Another theme were tweets defending the rapper Ye, formerly Kanye West, who had made a number of antisemitic remarks after he had his account briefly reinstated by Musk.

Our research, which has not yet been peer-reviewed, also found around 4,000 of the antisemitic tweets were focused on the Russian invasion of Ukraine. These variously claimed that the conflict was caused by Jews, or that Jews secretly caused the U.S. to support Ukraine. They also contained direct antisemitism directed against the Ukrainian president, Volodymyr Zelenskyy, who is Jewish.

Musk rolls back content moderation

Musk’s acquisition of Twitter came on the back of what I have observed as a decadelong trend among tech giants to take more responsibility for hate speech, harassment, incitement, disinformation and other harms lurking in the information flowing through their platforms. Over that period, companies such as Facebook and Twitter gradually enacted policies to respond to extremism, hate speech and harassment, or increase “civility,” as Twitter itself described it in 2018, and built out the teams and tools to enforce them.

Musk, a self-professed “free speech absolutist,” pointed the platform in a different direction after taking control. In short order, Twitter’s independent Trust and Safety Council was dissolved, previously banned accounts were reinstated and over half of Twitter’s staff was laid off or simply left – including many of those responsible for enforcing the company’s hate speech policies.

As someone who has tracked hate speech on places like Twitter for around 10 years, I believe the changes to Twitter’s moderation practices are only partly to blame for the jump in antisemitism on the platform.

The media spectacle surrounding Musk’s takeover, along with his very vocal views on free speech, likely also encouraged exactly those people to join or rejoin the platform who had fallen foul of its previous attempts to confront hate. Our research gives some backing to this theory. Some 3,855 accounts we identified as posting at least one plausibly antisemitic tweet joined Twitter in the 10 days after Musk took over. This is, however, only a small proportion of the 146,516 accounts that sent at least one antisemitic tweet over the course of the entire study.

Little effect on curbing hate speech

A surge in hate speech on Twitter was flagged by researchers in the weeks after Musk took over, concerns the billionaire dismissed as “utterly false,” having earlier vowed to “max deboosted & demonetized” hateful tweets.

If Twitter has been de-amplifying antisemitism, our research shows almost no evidence of it. Before Oct. 27, antisemitic tweets received an average of 6.4 “favorites” and 1.2 retweets. Since then, they have averaged 6 “favorites” and 1 retweet. Although such engagement isn’t a perfect measure for visibility, tweets made much less visible to users would generally receive less engagement.

We also attempted to measure takedowns of antisemitic tweets. On Feb. 15, 45 days after we initially collected the data, we tried to re-collect all the tweets we identified as antisemitic. Tweets can be unavailable for lots of reasons, and Twitter’s enforcement is only one of them. Imperfect though this is, it does give us a tentative glimpse of what might be happening in regard to the removal of antisemitic posts. And across those dates, 17,589 antisemitic tweets were taken down – 8.5% of the total.

Rising tide of antisemitism

Our findings come at a time when many fear growing threats to Jewish communities. In 2021, the Anti-Defamation League tracked the highest number of antisemitic incidents – including harassment, vandalism and assaults – in the U.S. since they started tracking numbers in 1979. And this is not just a U.S. phenomenon; in the U.K., the Community Security Trust has recorded a similar spike in anti-Jewish activity, while in Germany, anti-Jewish crimes surged by 29% over the pandemic.

Studying social media has shown me again and again just how powerfully it helps to form the cultures and ideas that underlie its users’ behavior. Ultimately, the proliferation of tweets that hold Jews responsible for all the world’s ills, that circulate dark conspiracies of control and cover-up, or that fire derogatory attacks directed toward Jews, can only support antisemitism online – and in the real world.

Carl Miller is a Partner of CASM Technology and a Senior Fellow at the Institute for Strategic Dialogue. They conduct a wide range of public-interest social media research on online harms for a range of philanthropic, foundation and public sector institutions.

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Climate damage is worsening faster than expected, but there’s still reason for optimism – 4 essential reads on the IPCC report

The final report in the IPCC’s sixth assessment series says countries will have to cut their greenhouse gas emissions 60% in the next 12 years to keep…



Wildfires are becoming a greater risk in many countries as the landscape dries. Michael Nigro/Pacific Press/LightRocket via Getty Images

Reading the latest international climate report can feel overwhelming. It describes how rising temperatures caused by increasing greenhouse gas emissions from human activities are having rapid, widespread effects on the weather, climate and ecosystems in every region of the planet, and it says the risks are escalating faster than scientists expected.

Global temperatures are now 1.1 degree Celsius (2 degrees Fahrenheit) warmer than at the start of the industrial era. Heat waves, storms, fires and floods are harming humans and ecosystems. Hundreds of species have disappeared from regions as temperatures rise, and climate change is causing irreversible changes to sea ice, oceans and glaciers. In some areas, it’s becoming harder to adapt to the changes.

Still, there are reasons for optimism – falling renewable energy costs are starting to transform the power sector, for example, and the use of electric vehicles is expanding. But the change isn’t happening fast enough, and the window for a smooth transition is closing fast, the Intergovernmental Panel on Climate Change report warns. To keep global warming below 1.5 C (2.7 F), it says global greenhouse gas emissions will have to drop 60% by 2035 compared with 2019 levels.

That’s 12 years from now.

Heat map shows how temperatures have changed and what they look like under different scenarios going foward.
The extent to which current and future generations will experience a hotter world depends on choices made now and in the coming years. The scenarios show expected differences in temperature depending on how high emissions are going forward. IPCC sixth assessment report

In the new report, released March 20, 2023, the IPCC summarizes the findings from a series of reports written over the past eight years by hundreds of scientists who reviewed the latest evidence and research.

Here are four essential reads by some of the co-authors of those reports, each providing a different snapshot of the transformational changes underway.

1. More intense storms and flooding

A line of rescue workers in bright vests and hard hats walks in waist-deep water on a flooded street, pulling a raft. Water is up to the mailbox they're passing.
A volunteer fire company assists with evacuation efforts following a flash flood in Helmetta, New Jersey, in August 2021. Tom Brenner / AFP via Getty Images

Many of the most shocking natural disasters of the past few years have involved intense rainfall and flooding.

In Europe, a storm in 2021 set off landslides and sent rivers rushing through villages that had stood for centuries. In 2022, about a third of Pakistan was underwater, and several U.S. communities were hit with extreme flash flooding.

The IPCC warns in the sixth assessment report that the water cycle will continue to intensify as the planet warms. That includes extreme monsoon rainfall, but also increasing drought, greater melting of mountain glaciers, decreasing snow cover and earlier snowmelt, wrote UMass-Lowell climate scientist Mathew Barlow, a co-author of the assessment report examining physical changes.

World maps show precipitation increasing in higher latitudes, but not everywhere.
Annual average precipitation is projected to increase in many areas as the planet warms, particularly in the higher latitudes. IPCC sixth assessment report

“An intensifying water cycle means that both wet and dry extremes and the general variability of the water cycle will increase, although not uniformly around the globe,” Barlow wrote.

“Understanding this and other changes in the water cycle is important for more than preparing for disasters. Water is an essential resource for all ecosystems and human societies.”

Read more: The water cycle is intensifying as the climate warms, IPCC report warns – that means more intense storms and flooding

2. The longer the delay, the higher the cost

A pedicab driver looks over at an SUV making waves as both drive through knee-high water.
Extreme rainfall filled streets in Dhaka, Bangladesh, in July 2020. Flooding has become common in many South Asia cities. Munir Uz zaman / AFP via Getty Images

The IPCC stressed in its reports that human activities are unequivocally warming the planet and causing rapid changes in the atmosphere, oceans and icy regions of the world.

“Countries can either plan their transformations, or they can face the destructive, often chaotic transformations that will be imposed by the changing climate,” wrote Edward Carr, a Clark University scholar and co-author of the IPCC report focused on adaptation.

The longer countries wait to respond, the greater the damage and cost to contain it. One estimate from Columbia University put the cost of adaptation needed just for urban areas at between US$64 billion and $80 billion a year – and the cost of doing nothing at 10 times that level by mid-century.

“The IPCC assessment offers a stark choice,” Carr wrote. “Does humanity accept this disastrous status quo and the uncertain, unpleasant future it is leading toward, or does it grab the reins and choose a better future?”

Read more: Transformational change is coming to how people live on Earth, UN climate adaptation report warns: Which path will humanity choose?

3. Transportation is a good place to start

3 EV's parked in a garage and charging.
Electric vehicle sales have been accelerating, and new tax incentives and state zero-emissions requirements are expected to boost sales even more. Michael Fousert/Unsplash, CC BY

One crucial sector for reducing greenhouse gas emissions is transportation.

Cutting greenhouse gas emissions to net-zero by mid-century, a target considered necessary to keep global warming below 1.5 C, will require “a major, rapid rethinking of how people get around globally,” wrote Alan Jenn, a transportation scholar at the University of California Davis and co-author on the IPCC report dealing with mitigation.

There are positive signs. Battery costs for electric vehicles have fallen, making them increasingly affordable. In the U.S., the 2022 Inflation Reduction Act offers tax incentives that lower the costs for EV buyers and encourage companies to ramp up production. And several states are considering following California’s requirement that all new cars and light trucks be zero-emissions by 2035.

Charts showing falling costs and rising adoption
Costs have fallen for key forms of renewable energy and EV batteries, and adoption of these technologies is rising. IPCC sixth assessment report

“Behavioral and other systemic changes will also be needed to cut greenhouse gas emissions dramatically from this sector,” Jenn wrote.

For example, many countries saw their transportation emissions drop during COVID-19 as more people were allowed to work from home. Bike sharing in urban areas, public transit-friendly cities and avoiding urban sprawl can help cut emissions even further. Aviation and shipping are more challenging to decarbonize, but efforts are underway.

He adds, however, that it’s important to remember that the effectiveness of electrifying transportation ultimately depends on cleaning up the electricity grid.

Read more: Revolutionary changes in transportation, from electric vehicles to ride sharing, could slow global warming – if they’re done right, IPCC says

4. Reasons for optimism

A man installs solar panels on a roof.
Solar panels have become increasingly common on homes, businesses and parking lots as prices have fallen. Ben McCanna/Portland Press Herald via Getty Images

The IPCC reports discuss several other important steps to reduce greenhouse gas emissions, including shifting energy from fossil fuels to renewable sources, making buildings more energy efficient and improving food production, as well as ways to adapt to changes that can no longer be avoided.

There are reasons for optimism, wrote Robert Lempert and Elisabeth Gilmore, co-authors on the IPCC’s report focused on mitigation.

“For example, renewable energy is now generally less expensive than fossil fuels, so a shift to clean energy can often save money,” they wrote. Electric vehicle costs are falling. Communities and infrastructure can be redesigned to better manage natural hazards such as wildfires and storms. Corporate climate risk disclosures can help investors better recognize the hazards and push those companies to build resilience and reduce their climate impact.

“The problem is that these solutions aren’t being deployed fast enough,” Lempert and Gilmore wrote. “In addition to pushback from industries, people’s fear of change has helped maintain the status quo.” Meeting the challenge, they said, starts with embracing innovation and change.

Read more: Climate change will transform how we live, but these tech and policy experts see reason for optimism

Editor’s note: This story is a roundup of articles from The Conversation’s archives.

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