"Volatility Index Declines, Signaling Reduced Market Uncertainty"

Cboe reports that as of the most recent close on September 26, 2025, the Cboe Volatility Index, or VIX, stands at a sale price of 15.29. This reflects a decrease from the previous report on September 25, 2025, when the VIX settled at 16.74. That’s a percent change of minus 8.66 percent since last reported.

The VIX is commonly known as the “fear gauge” because it measures expected volatility in the S and P 500 index over the coming 30 days. A decreasing VIX price suggests market participants anticipate lower volatility and less uncertainty in the near term. The most recent move downward extends a weeklong trend where the VIX averaged above sixteen but progressively fell from 16.74 on September 25, 16.18 on September 24, and 16.64 on September 23, before this latest drop to 15.29.

Several underlying factors have contributed to this decline in the volatility index. First, equity markets remained stable over the past week, with fewer major earnings reports or macroeconomic data releases surprising investors. Second, global financial conditions were mostly calm, as interest rates held steady after the Fed’s last statement, which reassured markets that no abrupt policy changes are coming. Third, the U.S. government avoided a shutdown following last-minute budget negotiations, reducing immediate headline-risk for stocks. In addition, softer inflation readings have lowered fears of aggressive future rate hikes, which typically drive volatility higher.

Examining the three-month S and P 500 volatility index, the VXV, also shows that volatility expectations are moderating, with the VXV closing at 18.41 on September 26, down from 19.46 the prior day. This not only supports the current trend seen in the VIX, but suggests confidence is building that market turbulence will remain checked for the next quarter.

Despite these signs of calm, traders and analysts will be watching for new data releases, geopolitical developments, or shifts in monetary policy that could reverse the downward trend in volatility. Historical patterns show that when the VIX drops toward the low teens, investors need to stay alert for unexpected shocks, since very low volatility can precede a reversal.

Thank you for tuning in to today’s Quiet Please production. Be sure to come back next week for more insights on market volatility and financial trends. To learn more or catch up on previous episodes, please visit Quiet Please Dot A I.

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