SYDNEY: The Australian dollar was set to test its July low on Wednesday, as a surging US dollar, underwhelming Chinese trade data and sliding global stocks emboldened the bears, while solid growth data at home offered little comfort.

The Aussie slid 0.4% to $0.6705, after having tumbled 1% overnight, as strong US services sector data fuelled more bets for aggressive Federal Reserve rate hikes, lifting the safe-haven greenback.

The currency is also within a whisker of its July low of $0.6683. A break there would take it back to levels not seen since May 2020, when financial markets were thrown into chaos as the COVID-19 pandemic spread.

But the Aussie gained 0.5% against the Japanese yen to hit its highest since July, as the Japanese currency continues to be weighed down by the Bank of Japan’s ultra-easy monetary policy.

The Kiwi fell 0.7% on Wednesday to $0.5998, its lowest level since May 2020. That came on top of a 0.8% plunge overnight.