Report published May 13, 2026

FX Daily: Low Volatility and Carry Trade Dominance (ING Report - 13 May 2026)

ING · May 13, 2026

FX volatility levels near five-year lows are keeping carry trades like AUD and NOK dominant. Meanwhile, the USD finds support from hawkish Fed expectations, and Sterling faces pressure from UK political uncertainty.

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Finvaulta summarizes ING's analysis. Attribute opinions, forecasts, time-sensitive values, and chronology to the issuer and report date; do not treat this page as an independent verification or a current market-data source.

Key Takeaways

1.FX volatility remains near 5-year lows, driving demand for high-yield carry trade currencies like AUD and NOK.
2.The USD is expected to remain in demand due to hawkish Fed pricing following high April CPI and the expected confirmation of Kevin Warsh as Chair.
3.Sterling is experiencing independent weakness due to political instability and potential leadership challenges for PM Keir Starmer.

USD: Fed pricing shifts more hawkishly
EUR: Low vol environment
GBP: Starmer clings on
CEE: Newsflow from Hungary is running out of steam but the story remains bullish
Author

Report data

Sterling finally saw some independent weakness yesterday as Westminster politics moved front and centre

Metric	Estimate	Context
EUR/USD 3-month traded volatility	5.7%	Trading more than 1% below realised volatility.
Brent Crude Price	106 USD/bl	Price near $106/bl.
USD deposit rate	3.65%	Relatively high rates supporting USD demand.
Eurozone GDP	0.1 percent QoQ	Second release estimate.

Source: ING; Eurostat (implied). This is a dated model snapshot, not a live forecast.

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Authors / Editors

Chris Turner · Global Head of Markets and Regional Head of Research for UK & CEEFrantisek Taborsky · EMEA FX & FI StrategistFrancesco Pesole · FX Strategist