Forex glossary
Hawkish vs Dovish
Relative descriptions of a policy stance or tone: hawkish suggests greater willingness to tighten, dovish to ease. Compare earlier positions and expectations; a statement or an individual's projection is not itself a bank decision or a guaranteed currency move.
Illustrative example
How does it work in practice?
In a hypothetical statement, a central bank shifts from signaling easing to allowing possible tightening while leaving its rate at 4%. Its tone is more hawkish than before, but the rate itself has not been raised.
A case to work through
Two reference points
A fictional bank discusses possible tightening after earlier considering cuts; a survey had expected an immediate hike.
- Relative to earlier guidance, the tone is more hawkish.
- Relative to the survey, no hike may be softer than expected.
What follows? Name the comparison point.
Example boundary: This does not establish currency direction.
A useful distinction
Hawkish vs Dovish / Rate Hike vs Rate Cut
Tone describes stance; a hike or cut describes an adopted rate change.
Check your understanding
Identify the reference point for a tone assessment.
Show the answer and explanation
The comparison point
A relative assessment needs a reference.
Reading central-bank decisions
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Read the fuller explanation
Related terms
Sources and documentation
- September 16, 2026: FOMC Projections materials, accessible version
Explains dots as individual policy projections for specified horizons.
Document read: - Transmission mechanism of monetary policy – ECB
Describes transmission channels and long, variable, uncertain policy-effect lags.
Document read:
The example illustrates the mechanism. Check current account conditions and instrument specifications with the provider.