Morgan Stanley warns its adjusted yield curve also suggests stock volatility is set to rise. The Cboe Volatility Index, or VIX, is sitting at around 18, above its one-year average of 16.
The curve “generally does a good job of telling us what to expect for the VIX,” according to the report. “Recession or not, we believe U.S. equity market volatility is likely to pick up significantly over the next 6 months.”
This article was provided by Bloomberg News.