AUD/USD ticks up to near 0.6500 as US Dollar struggles to hold Thursday's recovery

• AUD/USD ticks up as the US Dollar struggles to hold hot US PPI-driven gains.
• The US headline and core PPI grew at a faster pace of 0.9% in July.
• Australian Unemployment Rate decelerated to 4.2% in July.

The AUD/USD pair edges higher to near 0.6500 during the European trading session on Friday. The Aussie pair ticks up as the US Dollar (USD) struggles to hold Thursday's recovery move that was driven by hotter-than-expected United States (US) Producer Price Index (PPI) data for July.

During the press time, the US Dollar Index (DXY), which tracks the Greenback's value against six major currencies, declines 0.3% to near 97.70 from Thursday's high of 98.30.

The US Dollar falls back as traders remain increasingly confident that the Federal Reserve (Fed) will reduce interest rates in the September policy meeting, even as producer inflation grew at the fastest pace in three years.

According to the CME FedWatch tool, the probability of the Fed cutting interest rates in September is 92.6%, marginally down from 94.3% seen on Wednesday.

Headline and the core PPI - which excludes volatile food and energy prices - rose by 0.9% on a month after remaining flat in June. Market experts believe that business owners passing the impact of tariffs to consumers could allow the Federal Reserve (Fed) to continue maintaining its "wait and see" approach.

Meanwhile, the Australian Dollar (AUD) trades broadly stable as labor market conditions have improved. The Unemployment Rate decelerated to 4.2% in July, as expected, from 4.3% in June. In the same period, the Australian economy created a fresh 24.5K jobs, which were almost in line with estimates.