The graph below demonstrates what happened that when both QE1 & 2 ended volatility increased.
Of course, on both previous occasions volatility settled down within a month with markets beginning to expect another “round” of stimulus. When QE3 ends, markets will not be focusing on further stimulus but the timing of the next stage of the policy tightening process – the first rate hike from the Fed.
So it can be justly concluded the volatility will rise and continue after the end of QE in October.
