--- title: Changes That Could Affect Rates description: Inflation currently remains tepid and is the major reason why long-term rates, like home loans, remain near three-year lows. If inflation rises, home loan rates will rise. 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If the Fed allows inflation to rise north of 2% before considering hiking rates, **we are not likely to see a Fed rate hike anytime soon.** This is because inflation is currently running at 1.6% and well beneath the Fed's current target. 2. **If the Fed is successful in allowing inflation to rise, home loan rates will rise as well.** Inflation is the main driver of long-term interest rates. **When the Fed says they want inflation** to reach its 2% target, they are talking about the **Core Personal Consumption Expenditure (PCE) year-over-year** figure. **The Core PCE Index is typically delivered the third week of every month,**and will be even more important to track should the Fed make changes to its current policy and decide to allow inflation to rise above its longstanding 2% target. **Bottom line: inflation currently remains tepid and is the major reason why long-term rates, like home loans, remain near three-year lows. If inflation rises, home loan rates will rise. The opposite is also true.** ## Related Articles [![](https://www.carringtonwholesale.com/wp-content/blogs.dir/2/2021/03/Market-Trends_2021.03.08.jpg)](https://info.carringtonmortgage.com/knowledge-base/the-fed-inflation-and-a-twist) [Market Trends](https://info.carringtonmortgage.com/knowledge-base/tag/market-trends) ### [The Fed, Inflation, and a Twist](https://info.carringtonmortgage.com/knowledge-base/the-fed-inflation-and-a-twist) [Jordan](https://info.carringtonmortgage.com/knowledge-base/author/jordan) [Read More](https://info.carringtonmortgage.com/knowledge-base/the-fed-inflation-and-a-twist) [![](https://info.carringtonmortgage.com/hubfs/Market%20Trends_2022-05-15.jpeg)](https://info.carringtonmortgage.com/knowledge-base/cpi-high-rates-sigh) [Market Trends](https://info.carringtonmortgage.com/knowledge-base/tag/market-trends) ### [CPI High, Rates Sigh](https://info.carringtonmortgage.com/knowledge-base/cpi-high-rates-sigh) [CMS Marketing](https://info.carringtonmortgage.com/knowledge-base/author/cms-marketing) [Read More](https://info.carringtonmortgage.com/knowledge-base/cpi-high-rates-sigh) ## Mortgage & Lending Services - [Buy a Home](https://www.carringtonmortgage.com/home-loans/buy-a-home) - [Refinance a Home](https://www.carringtonmortgage.com/home-loans/refinance-a-home) - [Mortgage Calculators](https://www.carringtonmortgage.com/tools/calculators) - [The Loan Process](https://www.carringtonmortgage.com/tools/loan-process) - [Find an Expert](https://www.carringtonmortgage.com/find-an-expert) - [Home Builders](https://www.carringtonmortgage.com/Partner-with-Us/home-builders) - [Real Estate Agents](https://www.carringtonmortgage.com/Partner-with-Us/real-estate-agents) ## Terms - [Privacy Policy](https://www.carringtonmortgage.com/legal/privacy-policy) - [California Consumer Privacy Act Notice](https://www.carringtonmortgage.com/legal/ccpa-notice) - [State Licensing](https://www.carringtonmortgage.com/legal/state-licensing) - [Terms and Conditions](https://www.carringtonmortgage.com/legal/terms-conditions) - [Best Practices](https://www.carringtonmortgage.com/legal/best-practices) - [Fair Lending Statement / HMDA Notice](https://www.carringtonmortgage.com/legal/fair-lending-statement) - [Consumer Fraud Alert](https://www.carringtonmortgage.com/legal/consumer-fraud-alert) - [Equal Opportunities](https://www.carringtonmortgage.com/legal/Equal-opportunities) ## Manage Your Mortgage - [Payment Options](https://www.carringtonmortgage.com/payment-options) - [Mortgage Assistance](https://www.carringtonmortgage.com/mortgage-assistance) - [Disaster Assistance](https://www.carringtonmortgage.com/disaster-assistance) - [Scheduling Servicing Fee](https://www.carringtonmortgage.com/schedule-of-fees) - [Payoff Statements](https://www.carringtonmortgage.com/payoff-statements) ## Contact Us - Current Customers ## About Us - [Our Mission](https://www.carringtonmortgage.com/our-mission) - [Foundation](https://www.carringtoncf.org) - [Holding Company](https://www.carringtonhc.com) - [Accessibility](https://www.carringtonmortgage.com/accessibility) - [Press and Media](https://www.carringtonmortgage.com/pressandmedia) - [Contact us](https://www.carringtonmortgage.com/contact-us) ## Get the App [![](https://info.carringtonmortgage.com/hs-fs/hubfs/raw_assets/public/Templates/2022/svg/Carrington-mobile-apple.jpg?width=135&height=42&name=Carrington-mobile-apple.jpg)](https://apps.apple.com/us/app/carrington-mobile/id1673471360) [![](https://info.carringtonmortgage.com/hs-fs/hubfs/raw_assets/public/Templates/2022/svg/White-Google-1.jpg?width=135&height=42&name=White-Google-1.jpg)](https://play.google.com/store/apps/details?id=com.carringtonms.CMSMobile2&pli=1) [Icon-Facebook](https://www.facebook.com/CarringtonHomeLoans/) [Icon-Twitter](https://twitter.com/CarringtonMS) [Icon-Linkedin](https://www.linkedin.com/company/carrington-mortgage-services-llc) [Icon-Instagram](https://www.instagram.com/carringtonmortgage/) Icon-EHO Consumer Access NMLS ID #2600 | Copyright 2026 Carrington Mortgage Services, LLC. 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