This was working as desired before updating to the July 2018 version of Power BI.
I use a Year slicer using the same Date field that I use for the Timeline Slicer. If I have the year 2017 selected in the Year slicer, I see all 12 months in the timeline slicer. If I then select 2018 in the Year slicer, the Timeline Slicer should update to show all months in 2018 up to the current month (August). But instead it is showing all 12 months. If I try to select a month, the timeline slicer refreshes the data/visuals on the page, but does not filter down to the selected month in those visuals. In fact even the Timeline Slicer itself refreshes, but does not indicate that you have made a selection.
If I click on another report page and then click back to this report page, the page will then update and show only the appropriate months and the Timeline slicer acts as expected. At least until I select Year 2017 in the Year slicer. Then it refreshes the visuals on the page and the Timeline slicer will only display the months through August for 2017 and similary will refresh the visuals on the page when you select a month, but does not actual filter the visuals down to that month or even indicate that a month was selected.
This was all working in previous versions of Power BI.
The top image shows the broken timeline slicer, I then switched to page 2 in the report and then back to page 1 and took a screenshot of the working slicers.