An interpretation of the transport and magnetic relaxation properties of un
derdoped cuprates based on the recently proposed U(1) x SU(2) Chern-Simons
gauge field theory is proposed, which rakes into account the short-range an
tiferromagnetic order. The interplay of the doping dependent spin-gap (expl
icitly derived by us) effect and dissipation due to gauge fluctuations give
s rise to a crossover from metallic to insulating behaviour of the conducti
vity as temperature decreases, in semi-quantitative agreement with experime
ntal data. For the same reason the magnetic relaxation rate shows a maximum
nearby. Various crossover temperatures related to spin-gap effects are sho
wn to be different manifestations of the same energy scale.