FR: Merchandise Trade

September 7, 2016 01:45 CDT

Actual Previous Revised
Level E-4.51B E--3.44B E-3.45B

The seasonally adjusted trade balance was E4.51 billion in the red in July, up sharply from June's E3.45 billion and the largest deficit since April.

The deterioration was mainly attributable to a 2.4 percent monthly increase in imports, itself reflecting a rebound in oil purchases from a strike-depressed level in June. Exports dipped 0.2 percent as a fall in aircraft shipments was all but offset by rise in sales of other manufactured goods.

Exports remain disappointingly sluggish and in July were 2.7 percent below their level at the start of the year. But for the weakness of energy prices the trade shortfall would be significantly larger and today's data reinforce the impression that French competitiveness is not what it should be.


Changes in the level of imports and exports, along with the difference between the two (the trade balance) are a valuable gauge of economic trends here and abroad. While these trade figures can directly impact all financial markets, they primarily affect currency values in foreign exchange markets. Given the size of the French economy, the euro can be sensitive to changes in the trade balance. The bond market is also sensitive to the risk of importing inflation. This report gives a breakdown of trade with major countries as well, so it can be instructive for investors who are interested in diversifying globally. For example, a trend of accelerating exports to a particular country might signal economic strength and investment opportunities in that country.