The week started off in negative territory as the yen reported wide losses on Monday and the euro struggled for support after the Bank of Japan adopted negative interest rates on Friday, increasing expectations that the European Central bank will ease policy too.

The dollar was up 0.2 percent at 121.30 yen after having jumped nearly 2 percent on Friday, its biggest one-day rally in over a year.

According to some analysts, the BOJ’s surprise easing was aimed partly at forestalling the yen’s appreciation after the currency strengthened to its strongest in a year last month and the dollar touched 115.97 yen, its weakest since January 2015.

Stocks

Asian stocks started the week on a cautious note with the BOJ’s surprise policy move sparking some buying but further signs of economic weakness in China and a fall in oil prices keeping investors on guard.

European stocks were broadly expected to open steady with spread betters expecting Britain’s FTSE 100 to open up 0.4 percent, Germany’s DAX to open 0.2 percent higher, and France’s CAC 40 to be unchanged.

MSCI’s broadest index of Asia-Pacific shares outside Japan edged up 0.1 percent, after losing 8 percent in January.

Australia and Japan led regional markets with gains of 0.8 and 2 percent, respectively, while Chinese stocks slipped in afternoon trade.

According to Cliff Tan, head of global markets research with Bank of Tokyo-Mitsubishi UFJ, “In the short-term, the surprise move by Japan will be a catalyst for global equities but it only underlines the weakness of the global economy and we need to see some strong economic data for a sustainable rally.”