Trade tensions easing and strong earnings contributed to a rapid decline in the VIX

From Yahoo Finance: 2025-05-17 07:00:00

The Cboe Volatility Index fell from above 40 to below 20 at its fastest rate ever between April 10 and May 12. Trump’s tariff pauses have reassured investors, along with strong first-quarter earnings. The VIX closed at 17.24 on Friday, down more than 20% from the previous week.

Trade tensions easing drove the VIX’s decline. U.S. and China agreed to slash tariffs for 90 days. A solid first-quarter earnings season has boosted confidence, but uncertainty remains as “Liberation Day” tariffs are set to resume in early July. Any failure to negotiate may lead to renewed volatility.



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