Bond volatility surges while bitcoin and Wall Street stay calm

bond volatility surges — Bond market volatility has surged to its highest level since March, while measures of expected turbulence for bitcoin and U.S. stocks remain near yearly lows, highlighting a divergence in market sentiment.

The MOVE Index, which tracks expected volatility in U.S. Treasuries, jumped from around 80 to 104 this week, driven by rising energy prices and bond yields that are fueling inflation concerns. This marks the index’s highest reading since March.

In contrast, the crypto and equity markets show little sign of stress. The Bitcoin Volatility Index (BVIV), which gauges expected price swings for bitcoin over a 30-day period, is subdued near 37, close to its year-to-date low. The CBOE Volatility Index (VIX) for the S&P 500 also remains calm.

The 20-day correlation between the MOVE Index and the VIX has turned slightly negative for the first time since April 2024, indicating that the rising turbulence in bonds has not yet spilled over into equity or cryptocurrency markets.