Is it safe to ride on an unevenly bulging tyre?
Short answer, no it is not safe.

This looks like the tire bead is not correctly seated (not clinching the clincher) in which case deflating and reseating will likely fix the issue (check the bead...if it's damaged, the tire is done).

The other, less likely, possibility is a weak area on the tire. This is usually accompanied by a scrape or other damage to the sidewall of the tire...can't really tell in this picture, but I suspect you would have mentioned such.

In either case, riding on this can lead to a blowout. As it's a rear tire, this is not quite the horror it is with a front tire, but it still is not a lot of fun.

Be safe, fix or replace.

Happy Riding.