Trimmed Mean Inflation
An ABS measure of underlying inflation calculated from the weighted middle 70% of seasonally adjusted CPI price movements after trimming the largest rises and falls.
Plain-English definition. Trimmed mean inflation is an Australian Bureau of Statistics measure designed to show the underlying pace of price change after reducing the effect of unusually large price rises and falls in a particular month.
How it is calculated. The ABS ranks the seasonally adjusted monthly price movement for each CPI expenditure class from lowest to highest. Each class is weighted by its share of household spending. The bottom 15% and top 15% of the distribution by weight are trimmed, including the relevant part of a class at either boundary. The trimmed mean is the weighted average of the middle 70%.
The items removed can change each month. This is different from a fixed exclusion measure that always removes the same categories.
June 2026 example. Headline CPI fell 0.1% during June and rose 3.8% over the year. Annual trimmed mean inflation was 3.6%, unchanged from May. Automotive fuel fell sharply during June while some other prices continued to rise. The difference shows why headline and trimmed mean measures can move differently.
Why the RBA watches it. Trimmed mean inflation can help the Reserve Bank look through temporary or unusually large price movements when assessing broad inflation pressure. It does not replace headline CPI. Australia's flexible monetary policy target is for headline consumer price inflation to be between 2% and 3%, with policy set so inflation is expected to return to the midpoint.
Mortgage limit. A trimmed mean release does not change a mortgage by itself. The cash rate is set in a separate RBA decision, and lenders decide how product rates change. Use the Mortgage Repayment Calculator with an actual or assumed loan rate rather than entering trimmed mean inflation as the mortgage rate.
Sources. ABS CPI methodology, ABS June 2026 CPI release and RBA inflation target explainer, checked 30 July 2026.
This entry is general information only. It is not a forecast of inflation, interest rates, mortgage repayments or property prices.
Last updated: 30 July 2026.
Related tool: Inflation Scenario Calculator
Also known as: trimmed mean CPI, underlying inflation