EUR/USD moves above 1.1700 as France’s government survives a no-confidence vote

• EUR/USD rises as the Euro strengthens after France’s government survives a no-confidence vote.

• ECB policymaker Edward Scicluna noted that the central bank should not rush additional interest rate cuts.

• The US Dollar weakens as the ongoing government shutdown will continue into next week.

EUR/USD extends its gains for the fourth consecutive session, trading around 1.1710 during the Asian hours on Friday. The pair appreciates as the Euro (EUR) receives support after France’s government survived a no-confidence vote, as Prime Minister Sebastien Lecornu’s pledge to suspend a key pension reform won backing from some left-wing lawmakers.

Additionally, the Euro also draws support from the dovish outlook, contrasting with European Central Bank (ECB) projections, which suggest interest rates are likely to remain unchanged. ECB policymaker and Central Bank of Malta Governor Edward Scicluna said late Thursday that the central bank must not rush further interest-rate cuts. Scicluna added that it’s not clear whether higher trade tariffs will be disinflationary or inflationary, and we shouldn’t jump to conclusions as this is crucial.

ECB Governing Council member Martin Kocher said on Thursday, “I believe that we have reached the end of the interest rate reduction cycle or are at least very close to it.” Kocher further noted that it is “important to keep powder dry for potential crises.”

The EUR/USD pair rises as the US Dollar (USD) declines due to the ongoing US government shutdown, which will continue into next week after the Senate once again failed to pass a Republican bill to extend funding and end the stalemate, marking the tenth unsuccessful attempt on Thursday, the 16th day of the impasse.