Careful observers at the Fed, Bank of England and European Central Bank would do well to pay attention. The latest minutes from the Federal Open Market Committee have allayed fears of a 75 basis point hike in the short to medium term. They could even be interpreted as opening the door to a pause or a reduction in the magnitude of the tightening. “Many participants felt that accelerating the removal of political accommodation would leave the committee well placed later this year to assess the effects of policy firming and the extent to which economic developments warranted policy adjustments.” In other words, hurry up and walk, so we can slow down.

The message from Wednesday’s RBNZ meeting is similar. Officials raised their benchmark rate by half a point, as widely expected, and signaled further steps in that direction. Look further ahead, however, and the RBNZ is forecasting cuts in 2024. By the second half of next year, inflation will have receded to the upper end of the 1% to 3% target, from 6 .9% currently. Growth will slow to just over 1% in the year starting next March. The bank does not rule out a recession, but says that is not its assumption.

New BOK Governor Rhee Chang-yong also spoke strongly about inflation. Further rises are sure to follow Thursday’s quarter-point rise to 1.75%. The bank has lowered its growth forecast for this year. By all means, keep the inflation down, especially when you’re new to the job and have credentials to prove. But at what price and with what qualifiers? “While the Bank is expected to remain hawkish in the near term, it is likely to be significantly less forward looking as the economy slows,” Capital Economics economist Alex Holmes wrote in a note. “We believe the tightening will come to an end this year.”

While not exactly economic behemoths, South Korea and New Zealand are worth listening to, and not just because they started pulling out earlier than the Fed, BOE or the Bank of Canada. The country is at the center of many trends in the global economy: exports account for around 40% of gross domestic product; it is an essential link in the technology supply chain; and officials worry about exorbitant housing costs. New Zealand, for its part, pioneered formal inflation targeting three decades ago. The country also has an unfortunate history of moving early and aggressively to raise rates, then reversing course almost as quickly. Both countries are closely linked to the Chinese economy, which could contract this quarter and head for very weak growth this year.

At least the comments from currency leaders this week give us an opportunity to examine the prevailing hawkish narrative. The global economy is slowing, with the International Monetary Fund lowering its forecast last month. The fight against inflation is not something that should be carried out intensively without worrying about the costs. Post-pandemic, the political appetite and “public tolerance for having a central bank saying inflation is bad and we need to have a recession is very, very low,” the University economist said. of Harvard, Kenneth Rogoff, at a Bank of Japan web event. this week.

Economists are skeptical that New Zealand’s core rate will peak at 4%, as forecast by the central bank. The highest he is likely to get is 3.5%, according to many. The housing market is down and it is doubtful that the bank will be as tough as it claims. The risk of a slowdown must be weighed against the danger that “inflation expectations become unanchored and more persistent, and that means we have even more work to do in the future,” the governor said. Adrian Orr in an interview with Bloomberg Television on Thursday. . “We have to balance those two stories.”

Whatever Orr does, the alternate narrative he offers is indispensable. There have been too few questions about the Falcons this year. The doves could still strike back before the end of 2022.

More from this writer and others on Bloomberg Opinion:

• In search of the least bad version of monetary hell: Daniel Moss

• Has the inflationary wave broken? Expect More: John Authers

• The Fed is in no mood to pause on inflation: Jonathan Levin

This column does not necessarily reflect the opinion of the Editorial Board or of Bloomberg LP and its owners.

Daniel Moss is a Bloomberg Opinion columnist covering Asian economies. Previously, he was Bloomberg News’ economics editor.

More stories like this are available at bloomberg.com/opinion