(Bloomberg) – The Cboe Volatility Index, or VIX, extended its decline on Wednesday to close at its lowest level in more than three months as stocks rallied minutes after the most recent Federal Reserve meeting. The state signaled that investors could soon see a slowdown in growth. rate of interest rate increase.
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Wall Street’s fear gauge dropped to 20.35. The last time it ended lower was on August 18, in the heat of the summer rally, when it was still trading below the key 20 mark.
The VIX, which measures the market’s expectations of 30-day volatility, can serve as an important indicator of investor sentiment. That said, Wednesday was a light session before the US Thanksgiving break, with volume on the S&P 500 down 35% from the past 30-day average. Traders will want to see if these levels hold next week.
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