The Australian dollar dropped 0.7% to US64.95ยข, set for a 1% monthly decline and a 4.6% decrease this year.

The decline is primarily attributed to major economies' anticipated high interest rates.

The Reserve Bank of New Zealand's softened stance on rate hikes also influenced the Australian dollar.

The market now shows a 7% chance of an RBA rate cut next month, with full pricing for a move in September.

Iron ore price volatility, linked to concerns about China's property market, further contributed to the Australian dollar's decline.