* Traders digest weak U.S. PMI data * U.S. stocks decline supports yen gains * Yuan recovery helps Aussie (Updates prices, adds analyst comments, recasts throughout) By Sam Forgione NEW YORK, March 24 (Reuters) - The dollar fell broadly against major currencies on Monday after weak U.S. manufacturing data disrupted expectations that a stronger run of U.S. economic data would reinforce the Federal Reserve's plans to tighten its monetary stimulus.
Investors took profits in the U.S. currency after financial data firm Markit said its "flash" or preliminary U.S. manufacturing sector Purchasing Managers Index slipped to 55.5 in March from 57.1 in February. The results fell short of economists' expectations.
"Many had hoped that this was the start of clean data reports, so it takes a little bit of wind out of the sails for the dollar," said Mark McCormick, currency strategist at Credit Agricole in New York.
Analysts said traders had a delayed reaction to the data. The data had little effect on the dollar immediately following its release Monday morning.
Investors snapped up the dollar last week as they bet on a U.S. interest rate hike early in 2015, after Fed Chair Janet Yellen surprised markets by raising the prospect of such a move.
The U.S. dollar index, which measures the dollar against six major currencies, hit a three-week high of 80.354 last Thursday, a day after Yellen's comments.
"Weak data gave investors a reason to take profits," said McCormick.
The euro rose against the dollar, and was last up 0.33 percent at $1.3839. The euro had fallen earlier in the session after data showed the German private sector slowed in March, disappointing investors who were positioned for a better reading on the euro zone's largest economy.
Traders said the weak U.S. economic data offset concerns that the weak German economic data could spur the European Central Bank to implement more monetary easing, which would be negative for the euro.
The dollar index was last down 0.24 percent at 79.91. The euro was last up 0.35 percent against the dollar to trade at $1.3840. The dollar was last down 0.1 percent against the Japanese yen to trade at 102.17. The dollar was also down 0.26 percent against the Swiss franc at 0.8804 francs.
Declines in U.S. stocks on Monday helped draw demand for the yen as a safe-haven currency, said Greg Michalowski, chief currency analyst at FXDD in New York. The Standard & Poor's 500 stock index was last down 0.49 percent.
The Russian ruble also rose against the dollar, despite U.S. President Barack Obama's push to pressure Russia over its seizure of Crimea after Ukraine told its remaining troops to leave the region for their own safety.
"The currency markets have looked past the Russia and Ukraine story," said McCormick of Credit Agricole. The dollar was last trading down about 0.42 percent against the ruble at 36.0825 rubles.
A recovery in the Chinese yuan helped the Australian dollar move up from lows. The Aussie, which is used as a more liquid proxy by investors and speculators to back their views on China, had dipped after a survey showed activity in Chinese factories contracted again in March.
China's flash Markit/HSBC Purchasing Managers' Index fell to an eight-month low of 48.1 in March from February's final reading of 48.5.
The Aussie dropped to $0.9048 on the March number, but it kept clear of last week's low of $0.8990 and later drifted back to $0.9129, 0.47 percent higher on the day.
(Additional reporting by Anirban Nag in London; Editing by Nick Zieminski and Chizu Nomiyama)
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