The dollar jumped after a surprised improvement in U.S. economic data. The Institute for Supply Management (ISM) reported on Monday that its index for the U.S. services sector rose more than forecast in February to 57.3 from a previous month’s 56.8. Economists had expected a 56.1 rise. Any number above the 50 level shows an expansion, and below 50 is a contraction phase.
The data gave market sentiment a boost because the U.S. service sector is large and employs most of the nation’s workforce. An expansion in activity in the services industry that makes up almost 90 percent of the economy would help broaden the expansion.
Meanwhile, separate data on new orders also showed an improvement, rising to 61.2 percent from 59.4 percent.
The ISM non-manufacturing employment index slipped though to 55.7 percent from 57.4 percent but still above the 50 expansion level. The price index, which measures inflation, climbed 68.4 percent from 63.5 percent in the preceding month.
USDJPY jumped after the data from 81.33 81.49 within five minutes before easing to previous levels.