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The monetary-policy outlook is a tougher call, though. Even a pause would be a big deal after the most rapid global tightening in a generation. While Fed officials appear unified in their pushback against a less relentless approach, the US may be a laggard rather than leading indicator. For all the hype about India’s economy being one of the fulcrums of the 21st century, what the Reserve Bank of India says and does attracts relatively scant notice. Time for that to end. One of the most telling decisions of the past few weeks came from Jayanth Rama Varma, a longtime hawk on the RBI policy committee, who has become skeptical. Varma dissented against the bank’s December hike. The latest step poses “an unwarranted risk to economic growth,” he told Bloomberg News.More people may come to share Varma’s views, if they don’t already, especially if inflation retreats some more. The Reserve Bank of Australia recently revealed that a pause was on the table in December, though the board opted for a quarter-point increase. The hike forecast in South Korea this month will likely be its last. These are encouraging signs, even if they derive from weaker activity. A course correction is coming.
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