The US-Bangladesh commodity trade: An asymmetry analysis

The new direction on the link between the exchange rate and the trade balance today is asymmetry analysis. We enter into this direction by investigating the asymmetric effects of exchange rate changes on the trade balance of 11 industries that trade between the US and Bangladesh. These 11 industries together engage in 85% of the trade. We find evidence of short-run asymmetric effects in almost all industries. The short-run asymmetric effects last into long-run asymmetric effects in seven industries. At best our findings are industry specific.