Global stock markets were subdued Monday as investors exercised caution ahead of scheduled monetary policy announcements in the U.S. and Japan later this week. Although the U.S. Federal Reserve is unlikely to change interest rates during its upcoming meeting, analysts are speculating that the Bank of Japan, which adopted negative interest rates on some reserves that lenders park at the central bank, will loosen its purse strings further.

“There are now reports that the BoJ could introduce negative lending rates to complement negative deposit rates,” Kathy Lien, managing director of foreign exchange strategy at BK Asset Management, wrote in a note Friday. “With the Japanese economy struggling under the weight of a strong yen and slower global growth and speculators holding a record amount of long yen positions, the chance of easing by the BoJ is high.”

On Friday, these expectations translated into a 2.1 percent drop in the value of the yen to 111.80 against the dollar — the steepest fall in 17 months. However, on Monday, the Japanese currency recovered, and was, at 7:16 a.m. EDT, trading at 111.08 against the dollar.

"We are not yet convinced that the yen will continue to weaken in the near-term,” Lee Hardman, currency analyst at Bank of Tokyo-Mitsubishi UFJ in London, told Reuters. “The sharp weakening on Friday could also contribute to easing concern amongst BoJ policymakers over excessive yen strength.”

During overnight trade in Asia, Japan’s Nikkei 225 Index dropped 0.76 percent. China’s Shanghai Composite Index and the smaller Shenzhen Composite Index both ended the day down 0.4 percent. India’s S&P BSE Sensex and South Korea’s Kospi Index also ended the day slightly down.

The pan-European Stoxx 600 Index followed the Asian bourses into the red, trading down 0.36 percent in early afternoon trade. London’s FTSE 100, Germany’s DAX and France’s CAC 40 were also down over 0.4 percent. U.S. stock futures, meanwhile, were also slightly down, indicating a sluggish start to the week on Wall Street.

Among commodities, price of a barrel of Brent crude — the international crude oil benchmark — dropped 0.6 percent to $44.83, while the U.S. benchmark West Texas Intermediate was trading at $43.32 a barrel at 7:16 a.m. EDT.