German Bank: It is not surprising that the US dollar is indifferent to the US-Vietnam trade agreement.

Thu Lan Nguyen, the head of foreign exchange and commodities research at Deutsche Bank, pointed out that the US government announced yesterday that a trade agreement has been reached with Vietnam. At first glance, this may seem like a victory for the US government, but it is based on the premise that "it makes economic sense to attract imports through tariff suppression." I have serious doubts about this. In addition to exporting a large quantity of consumer goods to the US, Vietnam also exports commodities such as coffee. Regardless of whether the US can quickly increase its textile production capacity, it would be difficult to replace coffee alone - after all, the US mainland does not have the climate conditions suitable for coffee cultivation. Therefore, the conclusion is obvious: even if tariffs are no longer outrageously high, import tariffs may still cause more harm than good. Furthermore, Vietnam's economy is limited in size and lacks sufficient purchasing power to significantly increase imports from the US. It's not surprising that the US dollar did not strengthen yesterday due to the news of this agreement.