BCA Research said that it expects yield curves to begin flattening in the major developed economies in the months ahead, but the timing will vary significantly among countries.

“Yield curves have steepened across the developed world in recent weeks, driven by a rise in the term premium and longer-term inflation expectations, at a point when most major central banks are still anchoring the short-end of the curve,” BCA says in a research note released Tuesday.

But the firm reckons that these curves will begin to flatten “as investors anticipate rate hikes in the major economies”.

“Specifically, the commodity markets will continue to be at the leading edge of the monetary tightening cycle,” it says, noting that central bankers in Australia and Norway have already begun raising interest rates, causing their government bond curves to begin flattening. The Bank of Canada and New Zealand’s central bank “will need to start withdrawing stimulus by mid-year” it predicts.

After that, the central banks of Sweden, Switzerland, and the United Kingdom will be next to tighten, it says, likely lifting rates by the third quarter. “In anticipation, the 2-year bond yield in these markets should soon ratchet higher and lead to a flattening,” it notes.

The laggards, in terms of monetary tightening, are expected to be the U.S. Federal Reserve Board, European Central Bank, and the Bank of Japan, all of whom BCA sees as likely lifting rates late this year.

“Yield curves are unlikely to steepen much further in any developed market,” it concludes. “Investors should already be betting on flatter curves in the commodity markets and be gradually leaning into flattening trades in the U.K., Sweden and Switzerland, although [it’s] premature to bet on flattening in the U.S. and euro area.”

IE