The seasonally adjusted trade deficit narrowed again in March. At €8.02 billion, the shortfall was down from February's smaller revised €9.30 billion and was more than €5.5 billion below its level a year ago.

However, the reduction in the red ink only reflected a 1.2 percent monthly fall in exports that was easily more than offset by a 3.1 percent drop in imports. The headline improvement continues to be mainly led by a declining energy deficit although excluding the category, the balance has also improved somewhat in recent months. Total exports now stand 7.2 percent higher on the year while imports are up only 3.7 percent.

Overall net foreign trade added fully 0.6 percentage points to first quarter GDP growth and without this, the economy would have contracted.

The merchandise trade balance measures the difference between imports and exports of goods. The level of the international trade balance, as well as changes in exports and imports, indicate trends in foreign trade and can offer a guide to an economy's competitiveness.

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.