The Australian dollar's top forecaster has a warning: the worst is yet to come.

Investors should bet against the Aussie and short it versus the Japanese yen as increasing global-trade tensions weigh on the Australia's exports, according to CIMB Bank. The currency is also poised to decline versus the US dollar, says CIMB, which had the most accurate estimates for the Aussie in Bloomberg's second-quarter rankings.

The Aussie dollar hasn't had a good run recently, but the worst is yet to come according to the forecast. Credit:Bloomberg

"On all fronts, the US-China trade war is Aussie-negative," said Marcus Wong, a treasury strategist at CIMB in Singapore.

"Retaliatory action that inadvertently impacts the upstream or downstream of China's value chain, or leads to a keen deterioration in global risk sentiment, would see a further deterioration in the Aussie."