India VIX soars over 67% intraday: What the historic volatility spike signals for markets now

The India VIX, often referred to as the market’s fear gauge, staged a dramatic rally on April 7, 2025, spiking 67 per cent intraday to touch 21.94, the highest level since August 2024. This marks one of the steepest single-day surges in the index’s history and signals growing unease among investors.

What is India VIX?

India VIX, or the Volatility Index, measures the market's expectations of volatility over the next 30 calendar days. A rising VIX indicates that traders anticipate larger price swings in the near term — essentially, more market turbulence ahead. Conversely, a falling VIX signals a calmer market environment.

Add Zee Business as a Preferred Source

April’s volatility surge: A post-COVID record

The April 7 surge comes on the heels of back-to-back intraday jumps — 88.50 per cent and 79.06 per cent on April 3 and 2 respectively. While the index closed lower on those days (up 25.05 per cent and 42.23 per cent), the sharp moves marked the most aggressive volatility spike in the post-COVID market cycle.

What triggered the spike?

Market sentiment has been rattled by intensifying global trade tensions. The US Fed Chair Jerome Powell’s recent comments, where he held off further rate cuts and flagged the potential economic damage from the US-led tariff escalation added fuel to the fire. With inflationary concerns rising and growth forecasts under pressure, investor anxiety has reached fever pitch.

History of India VIX

Yes — but not often. There have only been four prior instances when India VIX surged over 50 per cent in a single day:

• August 24, 2015 (Black Monday): VIX jumped 64.36 per cent. It peaked the next day, then crashed 55 per cent within a month.

• August 24, 2009: VIX spiked 65.10 per cent intraday. After a brief surge, it cooled nearly 60 per cent over the next month.

• May 22, 2009: A 68.63 per cent rise intraday saw the VIX hit 87.53, but a 49.4 per cent correction followed in 30 days.

What next for markets?

Historically, sharp VIX spikes tend to reverse quickly often within weeks but they also serve as a red flag for heightened volatility. While this may signal an opportunity for contrarian investors, it’s equally a warning: brace for potential turbulence in the days to come.