

Stock markets brace for pre-budget jitters. History suggests the fear may be fleeting
. While the fear gauge still hovers near 10, January is shaping up to be a month of heightened volatility, suggesting that market swings could intensify as budget day approaches. The Union budget is likely to be tabled on 1 February this year.Historically, the India Vix edges higher ahead of the Union budget as investors price in uncertainty around policy decisions and spending priorities.
Once the budget is presented on the first day of February and expectations are recalibrated, volatility typically cools—unless there is a sharp negative surprise.This pre- and post-budget pattern has been consistent since the pre-covid years.According to Bloomberg data, the India Vix surged 48.85% in January 2020, before moderating to a 33.78% rise in February after the budget. Similar trends have played out repeatedly between 2019 and 2025.
In 2025, for instance, the volatility index rose 12.46% in January but fell 14.38% in February as investors digested the budget outcomes.In simple terms, a rising Vix signals growing uncertainty and wider expected market swings, while a falling index points to easing anxiety, improving confidence, and stabilising sentiment. On Wednesday, the fear gauge was trading at 10.04, up 0.2% in a range-bound market.
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