Economic Policy Uncertainty (US, Global), Trade Policy Uncertainty, GeoPolitical Risk, Stock Market, and (now) Oil Volatility all enhanced from January 2025 onward. Coincidence?
Figure 1: US news EPU (blue, left scale), global EPU (red, scale), Trade Policy Uncertainty divided by 4 (green, right scale), GeoPolitical Risk index (brown, right scale). NBER defined peak-to-trough recession dates shaded gray.
Figure 2: VIX (blue, left scale), CBOE oil ETF volatility (red, right scale). NBER defined peak-to-trough recession dates shaded gray.
While higher levels of the indices have been recorded in the past, it’s pretty safe to say that much of the last year’s elevated levels are self-inflicted…
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