NEW YORK (CNNMoney.com) -- The waiting is the hardest part.

Stock investors won't have a good sense until at least September whether the Federal Reserve was right to bet that slowing economic growth will cool inflation. But the week ahead brings the first clues. (see chart)

Special Reportfull coverage America's cheapest gas is in this town Summer drivers to get a break on gas Why gas prices are likely to keep climbing You'll pay a little less for gas this summer Expect relief from record February gas prices Why gas prices are rising

Reports include July readings on consumer and producer prices, and the housing market. Regional gauges of manufacturing in the July-August period are also expected.

"The inflation data early next week will be crucial, but what will ultimately prove the bulls or bears right are the cycle of reports that are still a few months away," said Barry Hyman, equity strategist at EKN Financial Services.

That cycle of August and September inflation news will then lead into the next Fed policy meeting on Sept. 20.

Ahead of that trading will likely be choppy, as is typical of summer on Wall Street, said James Awad, president at Awad Asset Management.

August and September are traditionally the worst months of the year for the broad market indexes. On a day-to-day level, trading tends to be more volatile than usual, due to the fact that many bulls and bears are on the beach, not making big changes to their portfolios.

Last week the Federal Reserve Board decided that after 17 straight interest rate hikes since June of 2004, it was time to take a breather. The central bank held a key short-term interest rate steady at 5.25 percent, as Wall Streeters had expected.

In its statement, the bankers essentially said that a slowing economy should temper upward pressure on inflation in the months ahead. However, if that proves not to be true, the Fed indicated that it is prepared to raise rates again.

The decision and statement didn't exactly thrill market participants, with investors hoping for more clarity regarding the strength of the economy and what that will mean for corporate profits.

GDP growth in the second quarter slowed to a 2.5 percent annual rate, a recent report showed. That was almost half the pace of the previous quarter. Yet, second-quarter profits were again stellar, with the S&P 500 recording its 12th consecutive quarter of earnings growth of at least 10 percent, according to earnings tracker Thomson Financial.

Meanwhile, oil prices flirted with all-time highs again last week, and a second-quarter productivity report showed a surprise run up in unit labor costs, reviving worries about upward pressure on inflation.

"The market wants to see enough growth to allow profits to keep growing, but enough of a slowdown to be sure that inflation isn't going to hurt us too much," Awad said.

"Investors want to believe that the Fed is done, but that earnings can keep going," he added.

At this point, 89 percent of the S&P 500 companies have already reported earnings, and the results are on track to have grown about 16.3 percent from a year ago, according to Thomson Financial. That's a blended figure, combining reported and expected results.

The week ahead brings earnings from a few market-moving companies, including Dow components Hewlett-Packard (Charts), Wal-Mart Stores (Charts) and Home Depot (Charts). Dell (Charts), Gap (Charts) and Staples (Charts) report too.

Because of the focus on inflation, the Consumer Price Index (CPI) being released Wednesday will be critical.

Economists surveyed by Briefing.com expect that both CPI and core CPI - which excludes volatile food and energy prices - rose in July.

However, this isn't something that should upset investors or be seen as contradicting the Fed's outlook, said Matthew Smith, portfolio manager at Smith Affiliated Capital. Smith said that investors already know inflationary pressures increased last month.

"We'll see an uptick, because short-term inflation is on the rise, but medium and long-term inflation should still come down," Smith said.

However, he acknowledged that with thin summer trading, stock investors could take a knee-jerk negative reaction to the report, should it top expectations.

Investors will also be attuned to the July reading on building permits and housing starts, expected to show a continued erosion in those areas.

But of equal concern will be what develops on the geopolitical front, Smith said. Last week, markets were rattled by reports that British authorities foiled a planned massive attack on commercial airplanes flying between the U.K. and the U.S. and it sent oil, gold and other inflationary indicators lower.

At the same time, fighting between Israel and Hezbollah militants in Lebanon intensified ahead of a cease fire scheduled to begin Monday, and investors continue to worry about Iran's nuclear capabilities.

All in all, it should be a challenging week for investors.

The Fed pauses, but ...

The pause that doesn't refresh

Stocks that can ride a pause

Bernanke's risky bet

More market news