Hawkish and dovish

Example

Imagine inflation running at 4%, double the Fed’s 2% goal, while unemployment is starting to rise. A hawkish official might argue for another 0.25-point hike or for keeping rates high longer; a dovish one might prefer to pause, or even cut, to protect jobs. Markets react to the tone as well: a statement more hawkish than expected can push bond yields up and stock prices down the same day.

Hypothetical numbers, for illustration only.