The Nikkei Average Volatility Index (Nikkei VI) rose to 37.51 as of 14:10, up 7.00 from the previous day. Following the decline in US stocks, selling led trading in Tokyo, while concerns over higher oil prices and interest rates have spread.
The Nikkei VI rose sharply to 37.51 as of 14:10, up 7.00 from the previous day. The index reached an intraday high of 37.59 and a low of 34.18. Following the decline in US stocks the previous day, selling led trading in Japan in the morning, and Nikkei 225 futures also moved lower.
The elevated level of crude oil futures prices and concerns about a global rise in interest rates were cited as factors behind the increase in the Nikkei VI. Market participants are wary of rising volatility.
The Nikkei VI is an indicator of the expected magnitude of fluctuations in the Nikkei 225 over the coming month. It tends to surge when stock prices fall sharply and usually has an inverse correlation with the Nikkei 225. There is also a view that the index may return to its range going forward.