Dovish
Dovish describes a central bank leaning toward rate cuts or looser policy, which usually weakens its currency.
Dovish means a central bank leans toward rate cuts or looser policy. Dovish surprises usually weaken the currency because lower rates make it less attractive.
Dovish describes a central bank or policymaker inclined toward looser monetary policy: interest rate cuts, expanded bond buying, or a slower path to tightening. Dovish surprises tend to weaken the currency because lower rates make it less attractive to hold. It is the direct opposite of hawkish.
How It Works
- Used to describe decisions, statements, minutes and speeches
- A dovish cut with more cuts signalled is weaker for the currency than a one-off cut
- The opposite is hawkish
Trading Tips
Dovish central banks make their currency a funding currency for carry trades
Watch for the market pricing the next move - the reaction is about the path, not the level
Related Terms
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