Australia's 10-year government bond yield has decreased to approximately 4.35%, driven by new labor market data that bolsters the argument for a potential rate cut in the upcoming month. The unemployment rate in Australia rose to 4.3% in June, marking its highest level since November 2021 and surpassing predictions that it would hold steady at 4.1%. Moreover, employment figures saw an increase of only 2,000 jobs, significantly lower than the anticipated 20,000 gain, after a revised decline of 1,100 jobs in the previous month. These statistics indicate the first tangible signs of fragility in what has traditionally been a strong labor market, leading traders to fully expect a rate cut in August. There are also market expectations for an additional cut, with a strong possibility of a third. This report is of particular importance to the Reserve Bank of Australia, as the robustness of the labor market—and the potential risk of rekindling inflation—has been a pivotal factor in its careful strategy regarding policy easing. The consumer price index report for the second quarter, scheduled for release at the end of July, is now anticipated as a critical indicator that could influence the RBA’s policy decisions.