The RBA board gathers today after a five-week lay-off. We hope its members have pondered its dilemma. The issues that it says it worries about, namely leading indicators of goods and services price inflation, have edged higher, building the pipeline of future inflation rate increases. But most activity measures – employment apart – are weak.

However, the list of adverse indicators of future inflation is swelling alarmingly. Henry’s advice to the board of the Reserve Bank, which meets today, is here.