As a result of the monetary and financial policies implemented globally in the pandemic period, economies have recently faced inflationary risks.

Although the main goal of the authorities of the world's largest economies is to minimize the effects of the pandemic, issue-of bank-notes have created strong demand for commodities in international markets. High prices for commodities such as natural gas, aluminum, grain and crude oil, contributed to the upward outlook for inflation.

At this point, food and energy inflation, as well as the rise in intermediate goods, investment goods and durable goods groups, spread, inflation reached a 10-year peak even in the Eurozone, where for many years the overall level of prices decelerated.

In preliminary data released by Eurostat, the Consumer Price Index (CPI) in the Eurozone rose 0.4 percent in August compared to the previous month, standing at 3.0 percent year-over-year. Consumer inflation in the region thus reached its highest level since December 2011. On the other hand, the Producer Price Index (PPI) in the region also broke a record in July with a level of 2.3 percent month-over-month and 12.1 percent year-over-year, indicating that cost pressures will continue.

As such, pressure began to build on the European Central Bank (ECB), the main actor in the policies of the European economy. The interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility remained unchanged at 0.00%, 0.25% and -0.50% respectively. Net purchases under the APP continue at a monthly pace of €20 billion and the Governing Council continues to conduct net asset purchases under the PEPP with a total envelope of €1,850 billion.

On the other hand, in the face of inflation pressures in the United States, which is the world's largest economy, the Fed is evaluating reducing asset purchases, while New Zealand and Australia, especially in the Asia-Pacific region, have reduced the pace of monetary expansion.

Considering the inflation outlook, which will move away from the 2 percent target due to the price pressures that will continue for a while in the region, it is expected that the European Central Bank will move in line with the monetary authorities of other developed countries and consider the reduction of asset purchases at the August meeting, which will end at 13:45 (GMT+2) tomorrow.

In the context of the base effect; although the region's inflation is likely to moderate, in case of stickiness in pricing, which policy tools the Committee can use, especially the asset purchase program, or what kind of formula the members consider will be the questions, for which the answers will be sought in the press conference of President Christine Lagarde at 14:30 (GMT+2).