The Australian dollar, often traded as a liquid proxy for global trade prospects, held around $0.7255, drifting away from a 2-1/2 month top of $0.7338 hit last week.

The Aussie had cracked above critical chart resistance of 73 U.S. cents last week but was unable to hold on to gains. It is now down more than 1 percent this week.

Its New Zealand cousin stumbled about 0.1 percent to $0.6804 on Friday after hitting a 4-1/2 month peak of $0.6883 last week.

The kiwi has fallen about 1 percent so far this week.

The losses in the two currencies coincided with a global share rout as investors fretted about a possible slowdown in world growth amid policy tightening in the United States and the bitter Sino-U.S. trade war.

Markets are focussed on a critical meeting between U.S. President Donald Trump and his Chinese counterpart, Xi Jinping, in Argentina next week to determine whether the world's biggest economies can de-escalate tensions over trade.

"Any good news at this meeting could boost the AUD," said Steven Dooley, currency strategist at Western Union Business Solutions.

Later in the day, investors will watch out for manufacturing activity reports from the United States and Europe, and a downward trend could further add to market jitteriness, analysts said.

The antipodean currencies did not fare well elsewhere either.

The Aussie and the kiwi hovered near one-week lows on the British pound  after Britian and the European Union in-principle agreed to a text setting out their future relationship before a summit on Sunday.

New Zealand government bonds gained, sending yields down about 2.5 basis points at the long end of the curve.

Australian government bond futures were barely changed, with the three-year bond contract down half a tick at 97.860. The 10-year contract was flat at 97.330.