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Jakobsen: Why a strong Dollar keeps markets weak and the Fed nervous

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Saxo Bank's Chief Economist Steen Jakobsen explains why the US Federal Reserve must be 'nervous' about another rate hike soon. Recent falls in stock markets have been sparked, once again, by a collapse in Chinese investor confidence but Steen underlines why the strong US dollar is a key factor in understanding wider market weakness.

Steen expects to see sideways trading for the next two to three weeks before seeing any rally. With Shanghai hosting an international central banks meeting at the end of February, analysts are anticipating a ramping up of rhetoric and further easing from the Chinese leadership in order to try to get some stability back into shell-shocked markets.