LONDON (Reuters) – Norway has become the first major developed economy to lift interest rates as growth rebounds following a pandemic that unleashed extraordinary stimulus across the globe.

Some central banks believe now is the best time to leave the country as the economy recovers and inflationary pressures rise. Other central banks are still cautious, given the uncertainty surrounding COVID-19 variations.

Below is a snapshot of where the major central banks are at this point in relation to exiting pandemic-era stimuli.

Graphic: cbank balsheet: https://fingfx.thomsonreuters.com/gfx/mkt/lbvgngzoqpq/cbank%20balsheet.JPG

1/ NORWAY

In addition to Thursday’s 25 basis point rate hike to 0.25%, Norway’s central bank forecasts four more hikes by end-2022.

Norges Bank is the most active of all the developed countries in normalizing ultra-loose policies, a view that will help Norway strengthen its crown.

Capital Economics senior European economist David Oxley stated that “we now expect them [rate officials] to raise rates to the previrus level (1.50%) before the end of next Year, which is quicker than investors expect.”

Graphic: Rate hike boost for the Norway crown: https://fingfx.thomsonreuters.com/gfx/mkt/egvbkyqmkpq/nok2309.png

2/ NEW ZEALAND

Markets price in a 100% chance that the Reserve Bank of New Zealand will raise rates by 25 basis points at its Oct. 6 meeting, after the central bank baulked at an expected hike in August as rising COVID-19 infections sparked another lockdown.

New Zealand’s economy grew a stronger-than-expected 2.8% in the three months through June. RBNZ expects its cash rate to rise above 0.5% in the final 2021, and above 2.2% by the year 2024.

Graphic: NZ: https://fingfx.thomsonreuters.com/gfx/mkt/klpykgbdgpg/NZ.JPG

3/ CANADA

Bank of Canada Governor Tiff Macklem believes the economy is moving closer to the point where the central bank will no longer need to continue adding stimulus via quantitative easing.

After tapering asset purchases in April, the central banks cut their weekly net purchases for government bonds down to C$2billion ($1.6 billion) in July. In October, it is anticipated to reduce this figure to C$1billion.

4/ UNITED STATES

The message from the Federal Reserve is clear: it will likely begin reducing $120 billion monthly bond purchases in November and rates could rise faster than anticipated.

The key factor in determining whether or not the Fed makes a move is the state of the labor market. This will be monitored closely when the October nonfarm payrolls report comes out. Although many economists think the Fed won’t raise rates until 2023, some believe it will.

“The standard for an announcement of a tapering in November was very low, so this is our main case. Luigi Speranza is the chief global economist for BNP Paribas Markets (OTC:). We expect the first rate increase in Q4 2022.

Graphic: Fed: https://fingfx.thomsonreuters.com/gfx/mkt/egpbkyqakvq/Fed.JPG

5/ AUSTRALIA

The Reserve Bank of Australia this month pressed ahead with plans for a A$1 billion ($727 million) tapering of its bond-buying programme to A$4 billion a week but in a dovish tilt, it said it planned to maintain bond buying at that level until at least February.

RBA’s next meeting is Oct. 5. The RBA stated that the economy would recover following a lockdown-induced slowdown but it expected rates to be kept at 0.1% through 2024, as inflation will likely not rise above and remain within its 2-3% target band.

6/ BRITAIN

Bank of England rate-setters meeting on Thursday rejected an early end to COVID-19 stimulus, although an additional policymaker voted for it to be curtailed. Also, the central bank stated that there was some support for modest tightening of monetary policies over the forecasting period.

British economic growth was slowing unexpectedly in July. Consumer price inflation reached a new nine-year record high, well above the 2% target.

Inflation could rise temporarily to 4%, according to policymakers.

The market is now pricing in the possibility of a rate increase by February 2022.

Graphic: BOE: https://fingfx.thomsonreuters.com/gfx/mkt/byvrjlergve/BOE.JPG

7/ SWEDEN

Sweden is firmly in the dovish camp, with no plans to raise its 0% rate until Q3 2024. It decided to close pandemic-era loans facilities and restore normal collateral provisions by the year’s end. Asset purchases will be stopped by that time.

If inflation continues to exceed the target of 2%, the Riksbank may tighten its policy faster. Inflation is expected to reach 3% within the next months. However, Governor Stefan Ingves is calm about the prospect. He stated that it was easier to deal with an overshoot of inflation than with an undershoot.

8/ EURO ZONE

The European Central Bank has taken a first small step towards unwinding emergency stimulus — it will trim emergency bond buys over the coming quarter.

The ECB insists that it isn’t tapering, and will continue to purchase assets in order to increase long-term inflation.

Last time it raised rates was in 2011. It isn’t expected to do so for several years.

Graphic: ECB bsheet: https://fingfx.thomsonreuters.com/gfx/mkt/lgvdwkanmpo/ECB%20bsheet.JPG

9/ JAPAN

A cautious view on exports and output stemming from supply bottlenecks suggests the Bank of Japan will lag its peers in dialling back pandemic-era stimulus policies.

Japan’s economy is in trouble due to disruptions in supply chains and the slow recovery caused by low consumption. The BOJ kept Wednesday’s short-term target of -0.1%, and the 10-year yield at around 0%.

10/ SWITZERLAND

The Swiss National Bank has the lowest interest rates globally, at -0.75%, and is not expected to budge from its ultra-expansive monetary policy anytime soon.

The bank remained firm in its stance and reiterated its resolve to implement currency intervention as necessary to reduce the appreciation of the Swiss franc (which it described as being “highly appreciated”).

Graphic: SNB: https://fingfx.thomsonreuters.com/gfx/mkt/dwvkrdleapm/SNB.JPG