I know Epic Games wants to improve the sky system according to Trello backlogs. I would like to see volumetric clouds get implemented, something along the lines of what Guerrilla Games has done:
“The Real-time Volumetric Cloudscapes of Horizon: Zero Dawn”
The day/night cycle is up to you to do with blueprints. Volumetric rendering on the other hand is a generally highly requested feature and I believe is already on the roadmap. That fog on the ground highly overlaps with clouds, which is essentially fog in the sky, should make it doable at the same time.