FX Daily: Markets reluctant to price in more JPY interventions in Daily Currencies Ratings 02/06/2026 USD: Volatility remains exceptionally low FX volatility has continued to plummet, with the widely watched CVIX index falling below 6.0 for the first time since March 2024. The FX market looks just as reluctant to price in a re-escalation in the Middle East this morning as it was to price in an imminent peace deal in recent days. Brent’s rapid return below $95 in the Asian session suggests broader sentiment is improving again, despite headlines that US-Iran negotiations have collapsed once more. The 99.0-99.50 range in DXY remains the ‘comfort zone’ for now. That embeds lower oil prices but also reflects the broadly stronger macro backing for the dollar. In our view, the latter factor could be reinforced by this week’s US data calendar. After a strong manufacturing ISM yesterday, focus turns to the April JOLTS jobs report. Layoffs will be closely watched following the March pickup, but consensus looks for stabilisation and no change in job openings. The net impact on the dollar should be neutral in that case, leaving Middle East headlines as the sole driver. Francesco Pesole EUR: Eurozone core CPI starts creeping up Eurozone flash inflation is set to rise from 3.0% to 3.2% in May. Core inflation is also expected to tick up, from 2.2% to 2.4% – unwelcome for the ECB, though not enough to raise immediate alarm. It should, however, support a hawkish tone alongside a highly likely rate hike at next week’s meeting (preview here). The somewhat surprising decline to 2.9% in 3-year CPI expectations in April is probably a testament to the importance of the ECB keeping tightening expectations elevated to prevent any de-anchoring. EUR/USD went through the usual Gulf-driven swings yesterday, but like the rest of the G10, it’s showing much more muted volatility. Once – if – a peace deal is ultimately signed, the euro can attempt a return to 1.180, but don’t expect the pair to pri