ZURICH, March 21 Reuters The Swiss National Bank cut its main interest rate by 25 basis points to 1.50 on Thursday, a surprise move which made it the first major central bank to dial back tighter monetary policy aimed at tackling inflation.

The central bank, in the first decision since longserving Chairman Thomas Jordan said he would step down in September, also reduced its interest rate on sight deposits to 1.50.

The move caught markets by surprise, sending the Swiss franc sharply lower against the dollar and to an eightmonth low agaist the euro.

A majority of analysts polled by Reuters had expected the SNB to keep rates on hold at 1.75. It was also the first rate cut by the SNB in nine years.

The easing comes after Swiss inflation dipped to 1.2 in February, the ninth month in succession that price rises have been within the SNB39;s 02 target range, which it defines as price stability.

The easing of monetary policy has been made possible because the fight against inflation over the past two and a half years has been effective, the SNB said in a statement.

The bank said that for some months, inflation had been back below 2 and thus in the range it equates with price stability. According to the latest forecast, inflation is also likely to remain in this range over the next few years, it added.

The SNB said it was taking into account the reduced inflationary pressure as well as the appreciation of the Swiss franc in real terms over the past year.

The policy rate…