The Australian dollar is likely to slide further as Brexit fears keep global markets in risk-averse mode.

At 0700 AEST on Wednesday, the local unit was trading at 73.58 US cents, down from 73.98 cents on Tuesday.

Traders are on edge amid fears the United Kingdom could leave the European Union after the June 23 poll.

“Brexit risks are likely to weigh on risk appetite until next week, keeping a lid on the likes of the Australian dollar,” Westpac strategist Imre Speizer said.

He tipped the currency to slip to 73.30 US cents on Wednesday, but said a cautious US Federal Reserve overnight should provide some support.

While traders have discounted a US rate hike this month, they will scour the Fed’s statement for clues on the health of the economy and the trajectory of tightening.

“Watch out for adjustments to the Federal Open Market Committee’s forecasts on growth and inflation,” Speizer said.

Stronger US retail sales figures also helped the greenback rebound slightly overnight, dragging the Aussie lower.

The data points to a pickup in consumption growth, partly offsetting concerns from a sharp slowdown in job creation, Speizer said.

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