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Shorthand for the two leanings on monetary policy. A "hawk" favors higher interest rates to fight inflation, even at the cost of slower growth. A "dove" favors lower rates to support jobs and growth, tolerating a bit more inflation.
Why It Matters
Commentators constantly label the Fed (or a statement) "hawkish" or "dovish," and markets move on the label. A surprisingly hawkish tone (rates higher/longer) tends to pressure stocks and lift bond yields; a dovish surprise tends to do the opposite. Knowing the two poles lets you decode the headline reaction instantly.
Key Points
- Hawk = prioritize fighting inflation (higher rates).
- Dove = prioritize growth/jobs (lower rates).
- Markets react to whether the Fed sounds more hawkish or dovish than expected.
Related Terms
Common Questions
Shorthand for the two leanings on monetary policy. A "hawk" favors higher interest rates to fight inflation, even at the cost of slower growth. A "dove" favors lower rates to support jobs and growth, tolerating a bit more inflation. Commentators constantly label the Fed (or a statement) "hawkish" or "dovish," and markets move on the label. A surprisingly hawkish tone (rates higher/longer) tends to pressure stocks and lift bond yields; a dovish surprise tends to do the opposite.
Commentators constantly label the Fed (or a statement) "hawkish" or "dovish," and markets move on the label. A surprisingly hawkish tone (rates higher/longer) tends to pressure stocks and lift bond yields; a dovish surprise tends to do the opposite. Knowing the two poles lets you decode the headline reaction instantly.
Hawk = prioritize fighting inflation (higher rates).
Dove = prioritize growth/jobs (lower rates).
Markets react to whether the Fed sounds more hawkish or dovish than expected.