The yen nursed broad losses on Monday, while the euro was also on the defensive after a surprise cut in Japanese interest rates sent bond yields sliding across the globe and particularly in Europe.
The dollar fetched 121.30 yen, having jumped nearly 2 percent on Friday - its biggest one-day rally in over a year. It was well off last month's trough of 115.97, when steep falls in global equities prompted investors to pile into the safety of the Japanese currency.
That safety flow could be partially revived should manufacturing data out of China later in the day renew worries about slowing global growth.
"Despite the perception the six-year slowing in China's economy is now becoming more rapid, we have yet to see real evidence of this in China's hard economic data. Midday today (Sydney time) will provide us a chance," said Richard Grace, chief currency and rates strategist at Commonwealth Bank.
The Bank of Japan's move to adopt negative rates on Friday only cemented expectations the European Central Bank would ease further, sending German two-year yields to a fresh trough of nearly 50 basis points below zero.
That weighed on the euro, which was last at $1.0830, well off last week's high of $1.0968. The common currency also pared gains on the yen, stepping back to 131.38 from a one-month high of 132.45.
Weakness in both the euro and yen helped drive the dollar index back toward 100.00. It traded at 99.606, just off Friday's peak of 99.829.
As a result, the greenback regained its footing against commodity currencies. The Aussie was last at $0.7081, reversing a brief move above 71 cents. The kiwi was at $0.6488, off Friday's high of $0.6543.
The immediate fortunes of both Antipodean currencies also hinge on the outcome of the Chinese data.