UPDATE 1-Australia and NZ dollars hit on flight from risk

* Ukraine tensions dent sentiment, falling Asian stocks weigh

* Government bond yields near multimonth lows

By Gyles Beckford and Cecile Lefort

SYDNEY/WELLINGTON, March 3 (Reuters) - The Australian and New Zealand dollars fell on Monday as escalating tensions in Ukraine and more signs of a modest economic slowdown in China sent investors scurrying for safety.

The Aussie AUD=D4 slipped to a one-month low of $0.8891, from $0.8930 on Friday, as the market bid up safe havens such as the yen and Swiss franc.

It has dropped more than 1-1/2 yen since a peak of Friday to trade at 90.20 AUDJPY= . Also weighing were falling stocks, with the Nikkei .N225 down more than 2 percent and bourses in South Korea and Singapore off 1 percent.

Support was seen at the March 5 low of $0.8872, with resistance around $0.8922, the 61.8 percent retracement of the January-February increase.

Risk sentiment took a hit as Ukraine mobilised for war, after President Vladimir Putin declared he had the right to invade his neighbour. News Search ID:nL6N0LZ0RF

Adding to the pressure, China's official Purchasing Managers' Index edged down to 50.2 in February from January's 50.5, though that was a whisker above market expectations.

News Search ID:nL3N0LY01N

The Aussie was last at $0.8905, having found little consolation from the biggest jump in job ads in more than four years. The private survey was seen as a potential sign of recovery in hiring after months of weakness. News Search ID:nL3N0M006Y

"The Aussie started the week nervously in apparent reaction to the weekend escalation of tensions between Ukraine and Russia," said Westpac in a note.

"There was a slight flicker higher, perhaps on the ANZ job ads bounce, but for the most part the Aussie held around 0.8895/00, absorbing the news flow from the Ukraine."

Other data released on Monday included a pick-up in price pressures for February, suggesting there could be diminishing scope for further cuts in interest rates. News Search ID:nS9N0DN01Q

The Reserve Bank of Australia (RBA) holds its March meeting on Tuesday and is considered certain to keep rates at a record low of 2.5 percent and repeat its steady outlook.

The New Zealand dollar NZD=D4 found a base around $0.8350 after it had opened at $0.8385, and hit a near seven-week high on Friday of $0.8428.

"A period of generalised risk-off will benefit the U.S. dollar - and Swiss franc and Japanese yen - but New Zealand's positive cyclical factors and higher interest rates make it a better proposition than other G10 currencies," said ANZ Bank analysts in a note.

Near term support for the kiwi was seen at $0.8313 and more substantially at $0.8280/90, the lows touched at the end of last week, with resistance at $0.8390.

Underscoring New Zealand's strong economic fundamentals was data showing terms of trade at a 40-year high on the back of strong dairy export prices and volumes. News Search ID:nW9N0J601Z

The data offered further backing to expectations that the Reserve Bank of New Zealand will start hiking interest rates on March 13, well ahead of most other developed economies.

The kiwi was a touch softer against the Aussie, but still within sight of a one-month high touched last week, while it was just above a one-week low against the yen NZDJPY=R .

New Zealand government bonds 0#NZTSY= were firm, sending yields 3 basis points lower along the curve.

The global flight to safety pushed Australian government yields towards multimonth lows, with the two-year bond

AU2YT=RR at 2.5 percent. A break below 2.47 percent would take it to levels not seen since August.

Australian debt futures also jumped with the three-year bond contract YTTc1 up 5 ticks at 97.190. The 10-year contract

added 4 ticks to 96.080.

(Editing by Chris Gallagher)

((Cecile.Lefort@thomsonreuters.com)(+61 2 9373-1234)(Reuters Messaging: cecile.lefort.thomsonreuters@reuters.net))

Keywords: MARKETS AUSTRALIA/FOREX