With Treasury yields elevated and investors reassessing interest-rate expectations, the next U.S. inflation reading could set the tone for stocks, bonds and the dollar.

Investors are approaching one of the week's most important economic releases: the September Consumer Price Index, scheduled for Wednesday, October 14, at 8:30 a.m. Eastern Time.

The report arrives as markets weigh persistent inflation risks, elevated energy prices and uncertainty about the Federal Reserve's next policy steps. Following recent volatility across equities and bonds, the inflation data may carry greater significance than a routine monthly release.

The key question is whether consumer prices are cooling sufficiently to give policymakers confidence that inflation is moving in the right direction. A softer-than-expected reading could ease fears that interest rates will remain restrictive for longer than investors anticipate.

That outcome could support growth stocks, particularly companies whose valuations depend on future earnings. Lower Treasury yields would also tend to support bond prices, while the dollar could weaken if investors reduce expectations for tighter monetary policy.

A hotter reading would create the opposite risk. Higher-than-expected inflation could push Treasury yields upward, strengthen the dollar and put renewed pressure on high-valuation technology shares.

Investors will need to examine both headline inflation and core inflation, which excludes food and energy prices. Energy costs can create sharp changes in the headline figure, while the core measure offers additional information about underlying price pressures.

One report will not determine the Federal Reserve's entire policy outlook. Policymakers also consider employment, economic growth and the persistence of price increases. Nonetheless, a meaningful surprise could lead markets to reprice their expectations quickly.

For traders, the distinction between the reported number and the market consensus will be critical. Even a relatively high inflation rate could produce a positive reaction if it is lower than feared.

What investors should watch: Headline CPI, core CPI, Treasury yields, the dollar and the immediate reaction in Nasdaq futures and rate-sensitive stocks.