The Australian and New Zealand dollars were softer against the US dollar and yen on Monday as investors wary of the unrest in Egypt and Middle East backed away from riskier assets.
The Aussie dollar hovering around $US0.9904, after nearing parity in Friday's offshore session, though it was up from an early $US0.9866 low. The Aussie was seen supported around $US0.9864, its January 24 low, with a cap of $US1.0005.
The New Zealand dollar sits around $US0.7706 from its local open at $US0.7717, well off a month-high of $US0.7795 hit on Friday.
In Australia, a private gauge of consumer prices showed underlying inflation slowed in January even as flood damage sent some food costs surging, adding to the case against a rise in interest rates anytime soon .
The Reserve Bank of Australia (RBA) holds its monthly policy meeting on Tuesday and is virtually certain to keep its cash rate steady at 4.75 per cent amid signs past hikes were working to restrain core price pressures.
Investors have priced out almost any chance of a hike until the second half of the year, though many analysts suspect a move could come in the second quarter given the strength of the terms of trade and business investment .
Geopolitics weigh on growth sensitive and emerging market currencies, with investors favouring the safety of the yen, greenback and Swiss franc, while the euro gives ground.
Worries about possible disruptions to oil supplies lifted crude to $US89.86 while gold reached $US1,338. The CRB index ended 1.22 per cent higher on Friday, offering some support to the Aussie.
US Treasuries prices climbed as Wall Street suffered the biggest one-day loss in nearly six months .
The Aussie was hovering around a two-week low against the kiwi at $NZ1.2830 and has now given up all of its December gains which saw it as high as $NZ1.3505 at one stage.
The Aussie and Kiwi were under pressure against the yen on risk aversion fears. The Australian dollar shed one yen to 81.19 yen since Friday and the kiwi fell to 63.19 yen, from a Friday high of 64.11 yen.
