Hawkish vs Dovish: Key Monetary Policy Differences

Central banks employ a range of strategies to steer the economy, tame inflation, and facilitate GDP growth. Monetary policy represents the most effective means of achieving this objective. It oversees the regulation of interest rates, the money supply, credit terms, household and business expenditures, and incomes. Monetary policy can be approached in two distinct ways: hawkish and dovish. Central banks, such as the US Federal Reserve, must decide between hawkish or dovish policy stances, repres