By Cecile Lefort and Rebecca Howard
SYDNEY/WELLINGTON, Feb 2 (Reuters) - The Australian dollar held under one-month highs against its U.S. counterpart and the yen in cautious trading on Tuesday as traders awaited the monthly policy statement of the central bank, while the New Zealand dollar kept recent gains.
The Australian dollar AUD=D4 was little changed at $0.7100, having recovered from a low of $0.7043 touched on Monday. It rose as far as $0.7142 last week, its highest since early January.
Resistance was found in the $0.7150-70 region, which coincides with 55- and 100-day moving averages and major retracement levels.
The Aussie also stood tall against the yen at 86 yen AUDJPY=R , not far from a peak of 86.36. It has bounced 7 yen since Jan. 20 when it plumbed a 3-1/2-year trough.
The Reserve Bank of Australia (RBA) holds its first policy meeting of the year on Tuesday and is considered certain to keep rates at a record low of 2 percent, where they have been since May of last year. An announcement is due at 0330 GMT.
Michael Blythe, chief economist at Commonwealth Bank of Australia expects the RBA to reaffirm a soft easing bias.
"The main interest will be how policy makers are reading China concerns and market volatility."
China is Australia's top export destination and the market often uses the Aussie as a liquid proxy to hedge against weakness, or wager on strength, in China.
Around one third of 32 economists polled by Reuters still think rates could be cut again this year. futures 0#YIB: imply almost no risk of an easing later in the session and around a 50-50 chance of a cut by May.
The New Zealand dollar NZD=D4 was steady at $0.6538, treading water ahead of offshore events.
The NZD has performed "relatively well" in the current risk-off environment, said BNZ FX Strategist Jason Wong.
"This seems to reflect portfolio flows, rather than fundamentals," he noted. The Kiwi was the weakest major currency in January, falling by 5.1 percent, so any outperformance should be seen in that context.
"We expect some consolidation around current levels. Our fair value estimate has risen a cent to $0.63," he said.
New Zealand government bonds 0#NZTSY= gained, sending yields between 0.5 and 3 basis points lower.
Australian government bond futures eased, with the three-year bond contract YTTc1 off 3 ticks at 98.110. The 10-year contract YTCc1 fell 4 ticks to 97.3400, while the 20-year contract YXXc1 was also 4 ticks lower at 96.8250. (Editing by Shri Navaratnam)