I have calculated for you the fluctuation intensity of all currency pairs traded in sufficient volume (weighted by their share in foreign exchange trading from the last Triennial Survey). It has never been unusually low this summer. In fact, it has been on the rise since early August. There is no sign of a summer lull.

Just because things were quite volatile last summer, we shouldn't use that as a benchmark. Apart from exceptional events (such as the outbreak of the pandemic), exchange rate volatility tends to be particularly high only when there is a high degree of uncertainty about the path of nominal and real interest rates and when major reassessments are required. That was the case last year. But now that the interest rate cycles are coming to an end, or have come to an end, the ‘music’ in the FX market has faded a bit.