FOREX-Dollar stabilises as Venezuela fears subside, risk-on mood grows

*

Geopolitical tensions cool demand for safe haven assets

*

Fed's Kashkari warns of risks to labour market

*

ISM Manufacturing PMI slides to 14-month low

By Gregor Stuart Hunter

SINGAPORE, Jan 6 (Reuters) - The U.S. dollar steadied near a two-week high as trading commenced in Asia on Tuesday, as market jitters from U.S. military action in Venezuela eased and dovish ?comments from Fed officials spurred risk-taking on Wall Street.

The dollar index, which measures its strength against a basket of six currencies, was ?last trading at 98.36, nudging up 0.04% after snapping a four-day winning streak on Monday.

"The market ?isn't really concerned about what's happening in the geopolitical front, at least ?in the near ?term," said Rodrigo Catril, currency strategist at National Australia Bank in Sydney.

That environment "lessens the appeal for safe havens and we've seen the U.S. ?dollar on the backfoot," he added.

Financial markets were ?volatile after the weekend's dramatic ouster of Venezuelan President Nicolas Maduro, which sparked volatility in commodity markets. Maduro pleaded not guilty to narcotics charges in a Manhattan ?federal court on Monday.

The Australian dollar, which is ?sensitive to commodity ?prices, was last down 0.1% at $0.6713, edging back from the top of the trading channel it has sat in for the past two weeks after copper prices hit a ?record high. The New Zealand dollar was last off 0.1% at $0.5784.

Against the yen, the dollar was last up 0.2% at 156.72 yen.

The dollar was pressured on Monday by dovish comments from Minneapolis Federal Reserve President Neel Kashkari, a voter on the central bank's rate-setting committee this year, who told CNBC he sees a risk that the jobless rate could 'pop' higher.

Expectations of policy easing edged ?up after ?his remarks, though Fed funds futures are still pricing an implied 82.8% probability that interest rates will remain on hold at the U.S. central bank's next meeting on January ?27-28, compared to an 83.4% chance on Friday, according to the CME Group's FedWatch tool.

The greenback felt further pressure as U.S. manufacturing activity contracted more than expected in December, falling to a 14-month low.

"The modest decline in the ISM Manufacturing Index in December confirms that the sector was struggling for momentum around the turn of the year, but we doubt that this will be enough to prevent overall GDP from expanding at a solid ?pace in the coming quarters," Capital Economics wrote in a research report.

Against the Chinese yuan trading offshore in Hong Kong , the dollar was last flat at 6.983 yuan.

The euro was 0.1% lower at $1.1713, while the British pound weakened 0.1% to $1.3533.

Bitcoin ?edged 0.2% lower to $93,900.82, while ether slipped 0.4% to $3,226.50. (Reporting by Gregor Stuart Hunter; Editing by Jacqueline Wong)