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Got the ECB policy decision and a fresh batch of PMI readings coming in from the euro zone this week! Here’s what’s expected from these catalysts.

ZEW economic sentiment index (Jan. 21, 10:00 am GMT)

  • Leading indicator of economic performance based on survey of institutional investors and analysts
  • German ZEW economic sentiment index to climb from 10.7 to 15.2 in Jan
  • Euro zone ZEW economic sentiment index to rise from 11.2 to 16.3 in Jan
  • Figures have been climbing over the past three months

ECB monetary policy decision (Jan. 23, 12:45 pm GMT)

  • No actual changes to interest rates or LTRO purchases expected
  • Central bank’s growth and inflation outlook to guide interest rate expectations
  • Dovish remarks could keep market watchers on the lookout for further easing while optimism regarding the recent pickup could boost the shared currency
  • Focus to be on strategic review being launched and potential adjustment in price stability targets
  • ECB press conference to take place at 1:30 pm GMT

Flash PMI readings (Jan. 24, starting 8:15 am GMT)

  • French flash services PMI to dip from 52.4 to 52.2, reflecting slower expansion
  • French flash manufacturing PMI to tick higher from 50.4 to 50.5
  • German flash services PMI to climb from 52.9 to 53.2 to signal faster growth
  • German flash manufacturing PMI to rise from 43.7 to 44.6
  • Euro zone flash services PMI to improve from 52.8 to 52.9
  • Euro zone flash manufacturing PMI to climb from 46.3 to 46.9

Technical snapshot

  • Stochastic paints a mixed picture of euro pairs, with EUR/JPY indicating overbought conditions and both EUR/USD and EUR/CHF looking bullish in oversold territory.
EUR Pairs Stochastic from MarketMilk
EUR Pairs Stochastic from MarketMilk
  • The short-term trend strength analysis tool reveals that franc pairs are mostly bearish.
CHF Trend Strength from MarketMilk
CHF Trend Strength from MarketMilk

Missed last week’s price action? Read the EUR & CHF price recap for January 13 – 17!