Eurusd Recovery Rabobank

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Eurusd Recovery Rabobank

EUR/USD Recovery To Emerge After 6 Months - Rabobank

Rabobank's latest forecast for EUR/USD reveals the pair will trade sideways in the coming months. According to them, a bullish trend will emerge after 3-6 months.

The latest forecast from Rabobank comes at a time when the EUR/USD pair has lost most of its bullish momentum. Looking ahead, the bank thinks the pair will trade sideways for a few months before recovery.

Euro Remains Bullish In Long Term

The bank commented that upward bias is expected in the pair by the end of the year. The bank added that the optimism over Germany's decision to raise its debt ceiling has faded away.

The key factors that are now weighing on the Euro are Eurozone growth and the high energy costs. These things are putting pressure on the Euro in the short-term. But it will not be enough to suppress the rally in the Euro in the long term.

As for the German economy, the bank thinks the government will need to take structural reforms. That's the only thing that will fix the weak growth and sluggish productivity.

Rabobank also noted that the EUR/USD pair has already priced in one more rate hike for 2026. So, even if we do get a rate hike from the ECB, it won't do much good for the pair.

On the contrary, the US Dollar is expected to get some relief because of its resilient economy. However, the US Federal Reserve doesn't have much room and will likely have to lower the rates.

So, the bottom line is that the ECB is expected to go ahead with a rate hike. Meanwhile, the US Fed is likely to lower the rates, as a tight policy will hurt the economy.

For the next few months, it is better to not build any long positions in the EUR/USD. But once the recovery starts in the EUR/USD, then long positions can be considered.

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