European stock indexes fell sharply on Tuesday as investors are cautious ahead of key central bank meetings while inflation is rising sharply and the ongoing conflict in Ukraine is likely to escalate.

By 03:40 a.m. ET (07:40 GMT), Germany’s DAX index was trading 1.9 percent lower, Britain’s FTSE 100 was down 0.9 percent and France’s CAC 40 was up 1.9 percent.

The European Central Bank is set to hold its latest monetary policy meeting on Thursday, but in the meantime, German consumer price inflation rose 2.5% in March from the previous reading, up as much as 7.3% year-over-year.

Equivalent U.S. inflation data will be reported a little later today, and investors are bracing for prices to rise to their highest level in 4 decades. This will be the last time the Federal Reserve will see official Consumer Price Index (CPI) data before its May meeting.

Data released on Monday showed the UK unemployment rate fell to 3.8% in February, to its lowest level since 2019.

Also of interest is Germany’s ZEW economic sentiment index, which is expected to show a decline in confidence in the eurozone’s largest economy in April due to the conflict in Ukraine.

In terms of corporate news, EasyJet shares fell 1.3% after the budget airline predicted it would lose more than £0.5 billion in the six months to March. However, the carrier said on Tuesday it had a strong and sustained recovery in bookings after the UK lifted restrictions on COVID-19.

Deutsche Bank shares fell 9.6% and Commerzbank shares fell 8.3% after an unnamed shareholder sold more than 5% of Germany’s 2 largest lenders on Monday evening; Novartis (SIX:NOVN) shares fell 1.1% after reports that the Swiss drugmaker is set to cut thousands of jobs globally as part of a reorganization.

ASOS shares rose 0.4% after the online retailer maintained its full-year outlook despite reporting an 87% drop in first-half profit, reflecting supply chain constraints.

Oil prices rose on Monday, recovering from recent losses after China eased some of its COVID-19-related restrictions, easing some concerns about oil demand from the world’s biggest importer.

In addition, the Organization of the Petroleum Exporting Countries warned that oil losses from Russian sources due to sanctions could be as much as 7 million bpd, adding that it would be impossible to make up for that volume.

The announcement followed a meeting between OPEC and European Union officials as the EU is currently working on proposals for an oil embargo on Russia.

Investors are now awaiting U.S. crude oil supply data from the American Petroleum Institute, due out a little later today.

By 03:40 a.m. ET (08:40 GMT), WTI crude futures were up 2.7% to $96.83 a barrel, while the Brent contract was up 2.6% to $101.05. Both benchmarks fell about 4% on Monday after recording their second straight losing week last week.

In addition, gold futures rose 0.4% to $1956.40 an ounce, while EUR/USD fell 0.2% to 1.0866.