The US dollar index rose above the 104.3 mark, reaching its highest level since March 4, as investors assessed the latest PMI data and awaited further clarity on President Trump's trade policies ahead of the April 2 deadline for his reciprocal tariffs. The latest survey revealed that US business activity picked up in March, with a significant rebound in the service sector offsetting a renewed decline in manufacturing output.

However, business expectations for the year ahead fell to their second-lowest level since October 2022, driven by concerns over demand, tariffs, and broader policy changes from the new administration. Meanwhile, Trump suggested Friday that there could be "flexibility" in the tariff plan, with weekend reports indicating the measures might be narrower in scope, potentially exempting certain industries.

On the monetary policy front, the US Fed reiterated that it is in no rush to further cut interest rates, despite signaling two rate reductions later this year.

Source: Trading Economics