Australia’s seasonally adjusted unemployment rate rose to 4.5% in July from 4.1% in June, exceeding the 4.4% market expectation, according to the Australian Bureau of Statistics. Employment increased by 58,200, driven largely by part-time work, while full-time employment declined by 14,500. The participation rate remained at a record 67.4%, meaning more people were employed or actively seeking work, while the underemployment rate edged up to 6.5%. The figures point to a labor market losing momentum after more than 300,000 jobs were added over the past year. The Australian dollar weakened slightly and bond yields dipped as traders increased bets on a possible interest-rate cut later this year. The Reserve Bank of Australia has held its cash rate at 4.35% since November 2023, and its September policy meeting will weigh the jobs data alongside inflation developments. Westpac senior economist Sarah Johnson said the slowdown would be welcomed by the RBA, while cautioning that record participation shows the labor force is still expanding. Higher unemployment could weigh on household confidence, spending, housing and retail, while businesses may become more cautious about hiring. The RBA forecasts unemployment could reach about 4.5% by the end of 2025, consistent with its full employment estimate. A continued weakening trend could increase the case for rate cuts, although the economy remains resilient.