India VIX soars 6% to 21.95 a day ahead of Union Budget

The India VIX index — a gauge for market volatility — soared 6 per cent to 21.95 a day before the Union Budget.

The spike signals that traders are expecting heightened volatility on Budget day. Historically, the Sensex tends to swing — the difference between day’s high and low — an average 3 per cent as traders look to price in various budget announcements.

This year, volatility could be higher against the backdrop of the US Fed’s hawkish pivot and the rising geopolitical tensions. Last year, the market had jumped 5 per cent following a pro-growth Budget.