Oil prices might seem unrelated to mortgage rates, but they are closely connected. It’s important to understand how oil prices affect mortgage rates.
The link between them is inflation.
Oil Prices Drive Inflation
When oil prices rise, everything becomes more expensive.
Shipping, manufacturing, and everyday goods all increase in cost.
That creates inflation.
And when inflation rises, mortgage rates typically rise with it.
If you want to see how oil prices affect mortgage rates and your current your monthly payment, connect with Better Rate Mortgage and we will run the numbers together.
Investors React Quickly
Bond markets react fast to changes in oil prices.
If investors believe inflation is coming back, rates move higher quickly.
This is why mortgage rates can shift even when the news seems unrelated to housing.
If you want help navigating today’s market, reach out to Better Rate Mortgage and we will build a plan that makes sense.
If you want a deeper breakdown of why rates have recently moved higher, read our full analysis on why mortgage rates are rising during Middle East tensions and oil price spikes.
