NEW YORK (CNN/Money) - Wall Street has again become somewhat wary of the economy's ability to live up to investors' high expectations. With the Fed meeting Tuesday, that wariness may persist into the coming week.

It's not like the economy is flailing in the current period. To the contrary, it is growing quite quickly, and with that growth companies are seeing a pickup in business. When third-quarter earnings come out next month, they will be quite strong.

But there are still big imbalances in the economy that will need to be worked out if growth is going to be sustainable rather than a flash in the pan. Even though business has improved markedly, companies have been quite conservative.

The weak job market is obviously a sign of this, but it is not the only sign. Inventories, for example, remain quite low, and economists believe that when the July business inventory report gets released Monday, it will show a decline. (Click here for a lineup of key events in the week ahead.) What's supposed to happen when business gets better, and what economists keep on saying will happen, is that companies will begin stocking their warehouses in expectations of better demand, and this will give the economy an extra little goose.

But the great inventory build has been about as slow to come as the Great Pumpkin. At 1.38 in June, the inventory-to-sales ratio was just a smidgen above its all-time low of 1.37, and it probably dropped in July.

"People say not to worry because ultimately companies will need to restock lean inventory positions, yet month after month inventories continue to languish," said Morgan Stanley economist Bill Sullivan. "Businesses are not acting as if they believe there is going to be a sustained boom in economic activity."

What makes companies' hesitance to build inventories even odder is that the cost of doing it is so low. If you run, say, a pencil factory, and you expect business to improve, you're going to load up on stuff like graphite and cedar. To finance that, you'll take on some short-term debt, which you'll pay down once you turn those raw materials into pencils and ship them.

With short-term rates so low these days (a bit more than 1 percent in the commercial paper market, for instance) the cost of financing is negligible. In other words, if you're wrong about the pickup in business, and you're stuck with extra inventory that's going to take a little while to draw down, it shouldn't be too much skin off your back.

This continued caution among businesses is one of the reasons the Federal Reserve will likely try to make as few waves as possible when it meets. Not only will the Fed hold rates pat, said Sullivan, it will leave its assessment of the economy unchanged -- even though the economy has obviously improved since the Fed last met.

Alan Greenspan and his fellow committee members don't want to do anything that would rock the expectations that rates will remain at low levels for a very long time. (For more on the Fed decision, click here.) If the Fed is successful in telegraphing that intention, borrowing costs should remain low, helping fuel growth to the point where companies will be left with the choice of hiring and building inventories, or getting left behind by the competition.

That point may still be a while in coming, thinks Conference Board economist Ken Goldstein. At its last reading, taken in June, the Conference Board's quarterly Business Executive Confidence Index showed that CEOs were no more confident than they were at the end of last year. The index will probably have improved for the current quarter -- Goldstein points to the greenlighting of capital projects as one sign that things are getting better -- but not remarkably so.

Stuck in this in-between time -- the economy is going great guns, but there's no clear sense the growth will persist -- investors are quick to duck for cover, thinks State Street chief investment strategist Ned Riley.

"The inclination is for people to sell on any kind of news that's worse than the best-case scenario," he said. That makes for an edgy market, and Riley thinks that edginess may persist until earnings season starts and optimism takes hold again.

• Economists expect business inventories for July, due out Monday, to be flat versus June's 0.1 percent gain.
• August industrial production, also out Monday, is expected to increase by 0.3 percent versus a gain of 0.5 percent in July. Capacity utilization is expected to come in at 74.7 percent, up slightly from July's 74.5 percent.
• The consumer price index, due out Tuesday, is expected to show a 0.3 percent gain, up from July's 0.2 percent rise. Inflation in the core, which excludes the volatile energy and food sectors, is expected to increase by 0.2 percent, matching July's reading.
• The Federal Open Market Committee meets Tuesday. No change in rates is expected.
• August housing starts, out Wednesday, are expected to decline 1.5 percent to 1.844 million after rising 1.5 percent in July.
• The Conference Board's index of leading indicators for August, due Thursday, are expected to show a gain of 0.4%, matching July's move.
• The Philadelphia Fed's September index of business conditions among manufacturers in its region, also due Thursday, is expected to come in at 15.1 versus 22.1 in August. Any number over zero indicates expansion.
• Friday is the quarterly expiration of stock and index options and futures -- often a source of market volatility.