Analysts bet: The first G10 central bank to cut interest rates will be Switzerland's

The Bank of Japan and the Swiss National Bank are the major central banks most likely to change the course of monetary policy in the next two months, according to analysts cited by CNBC, who note, however, that the changes these institutions will resort to have different directions.

According to economists' expectations, the first G10 central bank to cut interest rates will be the Swiss National Bank (SNB). The market considers a probability of approximately 60% for a 25 basis point reduction in the SNB interest rate in March, to 1.5%, notes the cited source, referring to LSEG data.

It should be noted that headline inflation in Switzerland fell from 1.7% in December to 1.3% in January, well below analysts' forecasts, while core inflation fell from 1.5% to 1.2 %.

Analysts at Capital Economics say: "We believe that lower Swiss core inflation will encourage SNB policymakers to cut the policy rate from 1.75% to 1.50% at their next meeting in March ".

Instead, economists at the Swiss bank UBS believe that the SNB will only start cutting interest rates in June, followed by two more cuts in September and December, so that at the end of the year the interest rate will reach 1%. "We believe the SNB will want to wait to ensure that domestic price pressures stemming from higher rents no longer pose upside risks to inflation (the latest forecast assumes inflation will rise to 2% in the second quarter )", according to UBS, which adds: "However, with the recent surprising drop in inflation in January, the SNB's forecast seems too high, and the probability of a monetary policy rate cut on March 21 has increased. In order to reduce interest rates, we believe that the SNB's forecast for inflation at the end of the year should fall below 1.5%, from 1.6% currently, and the trajectory of the forecast should become downward".

• The Bank of Japan will end the era of negative interest rates

While most major central banks are looking to ease monetary policy after more than two years of aggressive tightening aimed at fighting inflation, the question for the Bank of Japan (BOJ) is the other way around, according to CNBC.

In a recently released research note, Societe Generale shows that the Bank of Japan has all the necessary elements to finally eliminate its negative interest rate policies. The Bank of Japan's interest rate has been at -0.1% since January 2016 as policymakers tried to stimulate the economy in a prolonged stagnation. An interest rate increase would be the first in Japan in the last 16 years.

Japan's core inflation rate - which excludes food and energy prices - surprisingly fell to 2% in January on an annual basis.

"If inflation will stabilize around 2%, rather than falling to the average of the last ten years (a little over 1%), there is no reason to delay the elimination of negative interest policies", says Kit Juckes, head of the global foreign exchange strategy division within the French bank Societe Generale.

Most analysts expect the BOJ to end its eight-year run of negative interest rates in April.

• The Fed, expected to cut interest rates for the first time in June

The United States Federal Reserve (Fed) is expected to cut interest rates for the first time in June, with markets anticipating a 25 basis point (0.25 percentage point) cut to a range of 5%-5.25%, according to CME Group's FedWatch tool, CNBC notes.

Minutes from the Fed's January meeting showed that US central bank officials are wary of cutting interest rates too quickly, while expressing cautious optimism about the overall downward trend in inflation.

At the same time, analysts expect the European Central Bank (ECB) to start cutting interest rates in June, with eurozone inflation falling to 2.8% in January, while economic growth stagnates in most of the EU bloc.

The Bank of England will be among the last central banks to start easing their tight monetary policy, with most economists expecting a first rate cut in August, according to a recent Reuters poll.

The US investment bank Goldman Sachs last month changed its forecasts related to the interest rate cut, anticipating that this will happen in June, not in May, as it had previously predicted. However, the Wall Street giant suggested the Fed would then make five cuts of 25 basis points each this year, compared with three cuts as the market expects.

According to Goldman Sachs, the Fed's key interest rate will reach 4% by December.