The US dollar rose sharply in early trading on Tuesday, hitting a new high in three weeks, mainly influenced by strong data from the US service industry and cautious optimism in the market about tariff policies. President Trump has stated that not all tariffs he has threatened will be implemented on April 2nd, and some countries may receive exemptions, easing market concerns about a slowdown in US economic growth and driving up the value of the US dollar.

The US dollar rose 0.9% against the Japanese yen at one point, breaking through 150 yen, and then further rose in early Asian trading, reaching a three week high of 150.92 yen.

"The strong US service industry data has driven up the yield of US treasury bond bonds, while Japan's service industry and manufacturing industry are weak, which further exacerbates the strength of the US dollar." Industry analysts pointed out.

At the same time, the US dollar against the euro continued to adjust to the lower edge of the 1.0781 US dollar box, and the momentum of the euro gradually weakened after a strong rebound. The pound fell to a two-week low of $1.2883 and then stabilized at $1.2918 in Asian market trading. The US dollar index rose for the fourth consecutive trading day, closing at 104.3.

Trump has promised to implement car tariffs soon, but the market impact of tariffs has become complicated due to concerns about US economic growth, and the future trend of the US dollar is still unclear, "analysts added.

However, the next steps for the market are not clear. The data released by the US Commodity Futures Trading Commission (CFTC) last Friday showed that speculators turned bearish on the US dollar for the first time, despite the position being close to neutral.

Currently, it seems that no one knows how to deal with the US dollar, "said Brent Donnelly, President of Spectra Markets.

The trading of the euro/dollar has weakened, and the significant fluctuations in interest rate spreads and relative stock market performance have not been able to continue driving the dollar up

The view that tariffs have a clear supportive effect on the US dollar has been challenged in 2025, so even if we get more information about tariffs next week, it will be difficult to know how the market should react

At the same time, the Australian dollar has been steadily maintained at $0.6282, supported by optimism about the flexibility of Trump's tariff policies. The Australian government will release the pre election budget at 0830 Greenwich Mean Time, aimed at easing the cost of living pressure on the public.

Although Trump's comments on tariff policies have brought some market optimism and pushed the US dollar to a new high, there is still uncertainty about the prospects for US economic growth.

The short-term strengthening of the US dollar reflects more of the contrast between the strong performance of the service industry and the weakness of the Japanese economy, rather than the direct effect of tariff policies. The future trend of the US dollar will depend on the specific implementation of Trump's tariff policies and the direction of global economic growth, and market reactions are still full of variables.