Mind you as a tourist you’re going to be bumping into far more fluent locals than you might in day to day life otherwise. I’ve lived here for seven years and whilst I work in English and live in downtown Reykjavík I still meet a not unsubstantial number of Icelanders who are not comfortable with English. Mostly those 50+ but still some a generation younger. English speaking is definitely nearly ubiquitous in younger generations though.