The Australian dollar is likely to remain under pressure from the continued slide in the Chinese yuan, according to currency strategists, potentially opening the door for it to slide to fresh decade-lows.

Following another escalation in the trade war between the United States and China on Friday, the Chinese yuan fell to an 11-year low of 7.1470 per US dollar on Monday, dragging the Aussie dollar below US67 cents for the first time in three weeks.

Even during the mid-2000s, when China's yuan was widely viewed to be significantly undervalued, the US refrained from a currency manipulator designation. Credit:Bloomberg

"When there’s a sharp move in the yuan, the Aussie does tend to react in the same direction," said Sean Callow, senior currency strategist at Westpac Bank.

"Any time you see that it has a ripple effect around the region, other currencies weaken in sympathy and the Aussie goes with it."