​​​EUR/USD Rises Amid US Government Shutdown: Key Insights for Indian Forex Traders 

December 2nd, 2025

The forex market is feeling the jitters this October as the EUR/USD pair rose for three consecutive sessions. What’s the reason? The combination of a US government shutdown and upcoming Eurozone inflation data has made its mark on trading sentiment – pushing the euro higher against the US dollar. 

For Indians taking part in forex trading, it’s not just about reading global headlines. It’s about spotting what actually moves the market and figuring out where the chances are this month. In this post, we’ll go over what’s going on, why it matters, and how traders here in India might want to think about positioning themselves. 

What’s Happening: Shutdown in the US & Eurozone Inflation Ahead 

At 04:00 GMT, something unfortunate happened: The US government officially entered a shutdown after Democrats and Republicans failed to reach a funding deal. Practically, this political deadlock means that parts of the federal government will temporarily stop operating, and crucial economic data releases may face delays, including Friday’s Non-Farm Payroll (NFP) report, a key market mover for EUR/USD. 
This shutdown is especially painful because it comes at a sensitive moment for the US economy. The Federal Reserve is mulling over the question of further interest rate cuts, which are needed to support a weakening labour market. A delay in employment data adds a layer of confusion to that decision-making process, and this increased uncertainty in the markets. 
Turning our eyes elsewhere, we see attention is gathering towards eurozone inflation data, which is expected to show a rise from 2% to 2.2% year-on-year. If inflation comes in hotter than expected, this would make the case for the European Central Bank (ECB) to maintain current rates longer. This would support the euro and apply upward pressure to EUR/USD. 

Key Economic Developments: 

• US shutdown: Government funding expired at midnight in Washington; a new vote is expected later on. 
• Data delays likely: NFP and other key reports could be postponed. 
• Eurozone inflation: Expected at 2.2% YoY, potentially influencing ECB policy stance. 

These two forces - USD weakness from the political drama and euro strength from inflation worries - have created the perfect backdrop for EUR/USD bulls. 

Why Indian Forex Traders Should Pay Attention 

If you’ve traded forex for a while, you probably know EUR/USD isn’t just another pair. It’s the one everyone watches. When it moves, the rest of the market usually follows — from GBP/USD to USD/INR, and even some of the commodity-linked currencies. 

Volatility Means Opportunity 

Whenever something unusual happens, like a US government shutdown or a sudden shift in Europe’s inflation numbers, the market tends to get jumpy. For traders in India, whether you’re using CFDs or spot forex, that can mean bigger price swings, more breakouts, and plenty of setups worth keeping an eye on. 
The Indian rupee tends to take cues from whatever the US dollar is doing. When the dollar weakens, USD/INR usually softens too, which sometimes gives Indian traders a bit of a natural hedge if they’re juggling positions in other pairs. 

Global Trends Set the Tone 

Traders here who pay attention to the big global stories usually have an edge. The local forex market can feel a bit tight at times, so pairs like EUR/USD, with all that global liquidity, let Indian traders ride broader market moves instead of getting stuck reacting only to local news.  

Technical Outlook for EUR/USD – October 2025 

What’s the prognosis from the standpoint of technical analysis? EUR/USD has been edging upwards from support levels around 1.1645, where it found a base near the 50-day Simple Moving Average (SMA) and a falling trendline dating back to July. 

This famous pair is striving to reach the 1.1830 resistance level. A confirmed break above this could signal a new bullish phase, bringing the 1.1920 zone into focus as the next upside target. 

Conversely, if the rally loses momentum, you can look for support in the 1.1650–1.1700 area. If prices break below this zone, this could open the door to deeper declines toward 1.1580. 

Key Levels to Watch: 

• Resistance: 1.1830 (short-term), 1.1920 (medium-term) 
• Support: 1.1700 and 1.1580 

Traders in India using forex trading platforms should consider these levels when setting up breakout or range strategies. And always ensure proper risk management! 

FTSE 100 Hits Record Highs: A Global Sentiment Signal 

While there’s plenty of focus on EUR/USD, Indian forex traders should not forget global equity markets. The FTSE 100 index in the UK has pushed above 9,400 – hitting a fresh record high despite the risk-off tone from the US government shutdown. 

The pharmaceutical giants – AstraZeneca and GSK – contributed to the stock rally. This was after some clarity on tariffs and pricing emerged from recent US policy moves. This resilience in European equities acts as a sentiment barometer: When risk appetite improves in Europe, the euro may be bolstered against the USD. 

For Indian forex traders, then: 

• ​​Strong FTSE performance may signify improved European risk sentiment → supportive for the euro. AInvest​ 
• Watching indices like FTSE 100 can help you anticipate EUR/USD trends during major events. Plos  
• Global equity flows frequently influence major forex pairs, especially in volatile periods. Global Equity Flows Frequently Influence Major Forex Pairs, Especially in Volatile Periods  ScienceDirect  

Practical Takeaways for Indian Forex Traders 

1. Keep your eyes squarely on political developments in the US. Government shutdowns often trigger USD weakness, impacting EUR/USD and related pairs. 
2. Carefully track Eurozone inflation and ECB policy signals. Hotter inflation typically supports the euro. 
3. Make wise use of key technical levels (1.1700–1.1830) to frame trades. Breakouts and pullbacks in October may offer strong setups. 
4. Watch the FTSE 100 and global equities to gauge broader risk sentiment that affects forex trading. 
5. When it comes to risk management, there’s one word to remember: discipline! Volatility spells opportunity, but it also spells higher risk. Position sizing and stop-loss strategies are essential. 

FAQs – Indian Forex Traders & EUR/USD October 2025 

1. Why is EUR/USD rising this week? 

EUR/USD is going skyward due to a combination of factors. The US government shutdown engendered weakness in America’s dollar, and expectations of higher Eurozone inflation are buoying up the euro. 

2. How does a US government shutdown affect forex trading markets? 

Shutdowns take the wind out of the USD’s sails, creating volatility in major pairs like EUR/USD. Indian traders can capitalise on these moves through CFDs or spot forex platforms, depending on their broker. 

3. What are the key EUR/USD levels to watch in October? 

Support seems to lie around 1.1700–1.1650, while resistance sits at 1.1830 and 1.1920. A breakout above resistance could trigger more upward leaps. 

4. Can Indian traders use FTSE 100 as a signal for forex trades? 

Yes. The FTSE 100 often reflects broader European sentiment. When it rallies strongly, it may suggest risk-on sentiment. This will support the euro. 

5. Is October usually volatile for forex trading? 

Yes! October often brings increased institutional activity – coming after summer, major central bank meetings, and key data releases. This combination makes it an active month for forex traders globally. 

Final Thoughts 

For Indian forex traders, this October presents a generous array of opportunities: a rich combination of political, economic, and technical factors that make EUR/USD one of the most exciting pairs to watch. 

The US government shutdown is making traders jittery about the dollar. Hot eurozone inflation expectations are boosting the euro. Add key technical levels and global sentiment signals (like the FTSE 100’s rally) to the mix, and the forex trading environment is literally awash with opportunities. To take full advantage, traders should remain disciplined and informed. 

By cunningly combining fundamental insights, technical analysis, and global market context, Indian traders can approach the coming weeks with confidence.