A single number could determine the future of the Albanese government, Jim Chalmers’ budget policy and the household budgets of millions of Australian borrowers.

And that number will appear as most people rummage through their wardrobes for their work clothes after returning from a lazy summer holiday.

The number – the quarterly trimmed measure of inflation covering the three months to December – will be released on January 28 by the Australian Bureau of Statistics as part of its now monthly release of the nation’s consumer price index.

The Reserve Bank’s monetary policy committee on Tuesday held official interest rates steady at 3.6 per cent, but governor Michele Bullock made clear that people hoping for a further rate cut in coming months will be very disappointed.

“Given what’s happening with underlying momentum in the economy, that it does look like additional cuts are not needed,” she said.

The coming year will be a battle between holding rates steady – some economists believe the bank will walk through 2026 without varying the cash rate – and those who believe one or two rate rises will be on the RBA’s agenda.

The direction of that battle will be set on January 28 when the latest monthly and quarterly measures of inflation will be released.

The RBA’s focus will turn immediately to trimmed mean – an inflation measure that excludes the largest falls and increases in prices.

The bank’s forecasts about the inflation outlook factor in a 0.8 per cent lift on January 28. Anything above that and the bank will be considering a rate rise at its meeting on February 2 and 3.

The trimmed inflation mean has gained outsized importance because the past few years have delivered wild swings in prices. Accurately tracking inflation has become extremely difficult.

Electricity prices in Brisbane, for instance, soared by an unfathomable 1695.3 per cent in the 12 months to September due to the end of Queensland’s generous power subsidies. That eased to a still-off-the-scale 468.5 per cent annual rate of electricity inflation in 12 months to October.

NSW’s Independent Pricing and Regulatory Authority recently gave the green light to higher water charges that pushed Sydney’s measure of water and sewerage prices up by 19.4 per cent. In Perth, water and sewerage prices have inched up by 2.7 per cent over the same 12-month period.

On an annual basis, public transport fares in Canberra had fallen 1 per cent in August. By September, they had jumped by 63.5 per cent.

While the bank’s overriding focus will be on those numbers to be released on January 28, there are several other data releases of importance before then, with two coming in the next week.

Employment data, released on Thursday and then again in late January, should provide insight into the relative strength of the nation’s jobs market. If the releases show unemployment remaining about 4.3 per cent with 20,000 to 30,000 jobs being created every month, that will confirm the argument the overall economy is handling current interest rate settings without much trouble.

That would mean trouble for those with a mortgage come the Reserve’s February meeting.

But there has been noise in recent job reports. Expectations of a rate cut soared after the September report showed a jump in unemployment, but those expectations quickly reversed after the October report showed the jobless rate falling.

Then there is the state of the federal budget.

Last year’s budget finished with a deficit of $10 billion. In his March budget, Chalmers forecast the 2025-26 shortfall to widen to $42.1 billion.

While Bullock on Tuesday argued monetary and fiscal policy were working in tandem, a $32 billion increase in the deficit – a loosening of fiscal policy – is an issue.

Chalmers will release the mid-year budget update next week. A larger deficit would be a problem for the Reserve Bank. That’s partly why the government this week ended its $75-a-quarter energy supplements, and why Prime Minister Anthony Albanese on Wednesday talked up the government’s search for more budget savings.

“Every single budget we have had savings in, and that has made a difference. We want to make sure that the budget is as good as it can possibly be,” he told ABC television.

Some possible factors are beyond the control of both the Reserve Bank and the Albanese government.

It was only in May that the bank looked at a half-percentage-point rate cut due to the expected fallout from US President Donald Trump’s “liberation day” tariffs. Soon after that, markets were forecasting the RBA could take rates down to 2.85 per cent. The same markets now expect the cash rate to be around 4.1 per cent by Christmas next year.

Those tariffs are doing damage to the US economy – Trump this week revealed a $US12 billion ($18 billion) assistance package for American soybean producers caught in the crossfire of the tariff war between the US and China.

They’ve also had an impact here. One of the fastest-growing price points is beef and lamb, with annual inflation for these red meats now climbing at double-digit rates. The Bureau of Statistics has noted this is partly due to the US buying up beef from around the world, including from Australian paddocks.

UBS senior economist George Tharenou, who has had a good run picking Reserve Bank rate decisions, this week changed his call about the direction of monetary policy. He believes the RBA will deliver two rate rises next year, with a chance of three.

He said based on its own past reactions to the trimmed measure of inflation, the bank should already be moving.

“The RBA in more recent hiking cycles, started to raise rates when trimmed mean CPI was at 3 per cent year-on-year. This means, based on the RBA’s ‘historical reaction function’ to inflation outcomes, the ‘trigger to hike rates’ has, arguably, already been met,” he said.

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