In my opinion volatility and trader expectation are closely related. So if a trader sees that the market moves lets say 100pip on average they would continue to expect it to move around that rate. When you now factor in uncertainty the Traders no long know what to expect. This can have 2 effects. Either we become paralyzed which would result in a decrease in volatility or we become erratic which would result in an increase in volatility. Huge funds who are less emotional will see this activity and use it to there advantage.
The fact that the interest rates of the major economies are so low (and the spreads narrow) is a contributing factor to lower volatility in exchange rates. They are all pursuing similar monetary policies, so naturally their currencies will tend to do the same sort of thing - thus less pair volatility.