The Australian dollar edged lower on Thursday as concern about Chinese demand for commodities and confusion about the US Federal Reserve's next move continued to weigh on the domestic currency.

In late local trade the Aussie was fetching US69.99¢, compared with US70.36¢ at the same time on Wednesday. The local unit is now hovering around levelsseen two weeks ago, during the last bout of Chinese sharemarket turbulence.

The Australian dollar continues to test fresh 2016, but lacks the fundamental support to justify a sustained lift, BK Asset Management says. Credit:Getty

This trend has established it, along with a range of "commodity currencies", among the weakest of the year.

"Since the beginning of the year the Australian dollar has been one of the worst-performing currencies," said managing director of forex exchange strategy at BK Asset Management Kathy Lien.