Now all eyes are on Mario Draghi, president of the European Central Bank (ECB), as markets wait to see how his programme of recent stimulus measures will respond to the ongoing threat of deflation.

Azad Zangana, European economist at Schroders, confirms that the business has downgraded its growth forecast for the eurozone to 0.8 per cent in 2014 and to 1.2 per cent next year.

He explains: “Inflation has also been disappointingly low, which, in combination with weaker-than-expected growth, has prompted a lowering of medium-term inflation expectations.”

Mr Zangana dismisses any suggestion that Mr Draghi is preparing for full-blown quantitative easing (QE). “While his speech [to the central bank symposium in Jackson Hole, Wyoming, on August 22] was clearly dovish, we struggle to see the ECB announcing more aggressive measures like sovereign debt QE when extra liquidity to banks will be released next month, and asset-backed securities purchases are still being worked on. Markets may be in for disappointment,” he adds.

Investors and markets are also keeping a close eye on the US Federal Reserve and the Bank of England for any indication that interest rates might be raised.

According to Stewart Robertson, senior economist at Aviva Investors, central banks will maintain accommodative monetary policy longer than markets expect. “The global economy is likely to achieve encouraging growth levels this year, even with the tapering of the Fed’s QE programme as well as rising geopolitical tensions in Eastern Europe and the Middle East,” he says. “In our view, annualised global growth of around 3.5 per cent between 2015 and 2017 is largely in line with consensus.”

Turning to Japan, he says: “Unless growth resumes in the third quarter, a further extension of the QE programme should not be ruled out. On the plus side, inflation expectations have turned decisively positive – exactly the reverse of the situation in the eurozone – ensuring that real interest rates are negative, which should boost demand in future quarters. We believe that Japanese policy is likely to remain accommodative for longer than the market expects over the medium term, thus delivering significantly higher growth than expected in both 2016 and 2017.”

As the final quarter approaches, BlackRock’s global chief investment strategist Russ Koesterich has some cautionary words for investors. He says conditions are “ripe” for further increases in volatility and suggests it is a historically “soft period” for equities.

“Looking back at over 100 years of US data, September stands out as the one month with a statistically significant record of poor stock performance. What is interesting is that this trend occurs not just in the US, but in markets as far afield as Germany, the UK and even Japan,” he adds

“Still, a strengthening economy, low inflation and moribund Treasury yields suggest that stocks can and probably should move higher by year’s end. But negative seasonality and complacency over growing geopolitical risks recommend that investors exercise a bit of caution going into the fall.”

As central banks prepare to make significant policy decisions with the potential to impact global markets, investors should remember to take a long-term view and not be distracted by short-term moves.

Ellie Duncan is deputy features editor at Investment Adviser