The AUD/USD pair extends its recovery to near 0.6550 during Wednesday’s European session, supported by renewed strength in the Australian Dollar. Traders turn optimistic as markets expect the Reserve Bank of Australia (RBA) to maintain a restrictive policy stance in the coming meetings, keeping rate-cut bets in check.

Meanwhile, the US Dollar remains under pressure as dovish sentiment toward the Federal Reserve grows. Softer US labor data and expectations of policy easing have weighed on the Greenback, giving the Aussie additional tailwinds.

Investors now await Australia’s October employment data for fresh cues on labor market health and the RBA’s next policy steps. A stronger jobs report could reinforce AUD’s momentum, while a downside surprise may cap the recent gains near the 0.6550 mark.