Axios' Ben Geman and I write: The world's growing efforts to limit climate change will have far-reaching impacts for financial markets, and the groundwork for that push is being laid right now.

Why it matters: As more governments implement climate change regulations, trillions of dollars are going to flow toward clean energy and climate-friendly technologies, affecting significant portions of the global financial industry.

• A related trend: Governments and the private sector are increasingly crafting policies to force better disclosure of how climate change creates risks for the financial sector.

What's happening: A White House executive order last week is aimed at launching or expanding efforts to stitch climate-related financial risks into regulation and supervision.

• That was quickly followed by an announcement from the Bank of England signaling that it would shift purchases it makes in financial markets toward companies doing the most to fight climate change.
• The BOE's move is expected to be the start of a global effort by central banks to influence the financial services industry.

By the numbers: Major banks and asset managers are stepping up climate finance in response to both investor pressure and expanding market opportunities to commercialize increasingly competitive low-carbon products.

• For instance last month JPMorgan Chase pledged to "finance and facilitate" $1 trillion worth of climate efforts over the next decade and Bank of America similarly set a target of $1 trillion in climate finance through 2030.
• An International Energy Agency analysis last week suggests that to radically re-orient global energy systems on a pathway to net-zero emissions by 2050 annual energy sector investment would have to "surge" to $5 trillion annually by 2030.

What we're hearing: "One of the things that we’re seeing is that the financial industry is organizing itself for net-zero [carbon emissions by 2050]," former Bank of England and Bank of Canada leader Mark Carney tells Axios in an interview.

The big picture: Carney is a leading figure overseeing the transition from the financial industry's largely agnostic-about-climate past to its climate-priority future.

• Carney's a key organizer of the recently launched Glasgow Financial Alliance for Net Zero, a wide-ranging network of banks, asset managers, investors and insurers with 160-plus members that organizers say are responsible for over $70 trillion in assets.
• And Carney tells Axios there remain "a number of major institutions and geographies" he's hoping sign on ahead of the United Nations summit.

The bottom line: "When society values a certain outcome — in this case addressing climate change, getting to net-zero, focusing on that, public policy is oriented in that way, consumers start to consume in a certain direction — that flips a risk into a huge opportunity," Carney says.

In addition to everything else, Carney is a United Nations special envoy on climate finance and an adviser on these topics to the government of the U.K., which hosts a critical U.N. climate summit late this year in Glasgow, Scotland.

• His new book "Value(s)" is all about the coming changes.

What he's saying: "What we are looking to do is make sure that the plumbing of the financial system is ready and supportive of this transition," says Carney, who is also head of ESG at Brookfield Asset Management.

• That means growing investment in clean technology, but also financial sector policies that urge polluting companies they finance and invest in to take tangible steps to get cleaner.
• "We want a system where it makes sense to invest in or lend to a company that has high emissions today but is investing in order to get those emissions down."
• "We don’t want a binary system where it’s pure green or nothing."

Of the $50 billion American companies pledged toward racial equity following George Floyd's murder by Minneapolis police one year ago today, less than $250 million has been spent so far. (FT)

Senate Democrats are settling in on a post-Memorial Day deadline to forge a compromise with Republicans before going it alone on an infrastructure deal through budget reconciliation. (Axios)

The Chicago Fed's National Activity Index showed the U.S. economy was growing above trend in April but had slowed significantly from March's big rebound, suggesting the economy is having a difficult time gaining traction for a sustained rebound.

By the numbers: April's 0.24 reading was down significantly from the 1.7 reading in March, which followed the first negative reading in almost a year for the index.

What it means: The Chicago Fed's index seeks to answer the question, "Is the economy growing at a rate faster than its potential or slower than its potential?" using a weighted average of 85 existing monthly indicators of U.S. economic activity.

• The index is composed of four broad categories of data: production and income; employment, unemployment and hours; personal consumption and housing; and sales, orders and inventories.
• It is constructed to have an average value of zero and a standard deviation of one.

Watch this space: "The personal consumption and housing category contributed –0.06 to the CFNAI in April, down from +0.50 in March," the Chicago Fed said.

• "The indicators in this category broadly deteriorated from March. The contribution of the employment, unemployment, and hours category to the CFNAI decreased to +0.05 in April from +0.38 in March."

Despite much fanfare in recent months, the U.S. looks to have made minimal progress on the development of or consensus around a central bank digital currency (CBDC), despite advances from other central banks, including China's.

Driving the news: Fed governor Lael Brainard, who is leading efforts on a digital currency as the governor in charge of financial stability, delivered a speech on Monday detailing the state of research and development on CBDCs in the U.S. but provided little new information.

• She also continued to highlight potential risks like financial system fragmentation and consumer protection and financial stability risks.

Stay woke: Brainard occasionally deviated from her prepared remarks during her appearance at CoinDesk’s Consensus 2021 event, including a mention that it was important for Fed policymakers "to follow many central banks' progress on CBDC closely — including China."

• She also stressed that "we are at the table" as she noted, "Given the potential for CBDCs to gain prominence in cross-border payments and the reserve currency role of the dollar, it is vital for the United States to be at the table in the development of cross-border standards."

State of play: The Fed is behind other central banks in developing a digital currency, and not just China, which began testing a digital version of the renminbi with brick-and-mortar retailers last year and recently expanded to include the e-renminbi in digital wallets linked to Alibaba's Ant Group.

• Sweden's Riksbank is testing a digital e-krona, and the Bank of Japan is testing a digital yen.

What's next: Fed chair Jerome Powell recently announced that the Fed would issue a discussion paper "outlining our current thinking" on digital currencies in July.