Dollar Soars as U.S. Business Activity Surges and Tariff Speculations Ease

The dollar rose to multi-week highs against the euro and yen as U.S. business activity improved and President Trump signaled flexibility on tariffs. The U.S. services sector buoyed economic indicators, while traders anticipate upcoming tariff announcements. The euro and Turkish lira exhibited fluctuations amid geopolitical and economic developments.

The dollar surged to multi-week peaks against the euro and yen on Monday as U.S. business activity saw an upswing in March. Reports indicated potential U.S. tariff flexibilities, strengthening market sentiment. Bitcoin also saw gains, peaking at its highest since early March.

S&P Global's flash U.S. Composite PMI Output Index rose to 53.5, up from 51.6 in February. This indicates expansion in the private sector, credited largely to the services sector, amid warming temperatures. In contrast, manufacturing re-entered contraction territory after two months of growth.

Chief currency analysts note the importance of the U.S. services sector to the broader economy. Meanwhile, the dollar strengthened against the yen as news suggested possible tariff flexibility by Trump's administration, with markets bracing for precise tariff details and their implications.

(With inputs from agencies.)