V7.5: I've searched through the available permissions in the CP and can't find anything associated with the ignore function so I guess this is a bug.
Moderators and Global Moderators do not have the ability to ignore and unignore. This through the link that shows up in a member profile. The link just doesn't show up for Mods and Global Mods. Admins and normal users have the link and the function works for them.