Yes. Red has given the inside boat enough room to round in seamanlike manner.
Therefore Red has fulfilled her obligations under rule 18.2(b). Blue has not
rounded in a seamanlike way and is taking more room than necessary. In colliding
with Red, Blue infringes rule 11 (boats on the same
tack, overlapped). Red's luffing is moderate and does not infringe rule
16. Red only needs to avoid contact that causes damage in accordance with
rule 14. See also Case 25.