When does lag happen and how can I reduce it?

I'm running a capable computer 1.8 ghz, 512 ram, 128 geforce and I get lag at some inopportune times.

1. when I open the inventory. I get huge lag spikes that last 5-10 seconds. It's pretty annoying.

2. Combat. This is the killer, it generally happens when fighting close quarters and sometimes when I round a corner.

I understand that these are server issues but is there something I can do on my end? I'm playing off high speed cable through a router.

Sounds like you need to turn down your video settings a big, either set the resolution lower, set it to fastest quality, or a combination of both,

Also make sure your internet is stable.