The seasonally adjusted trade deficit widened out from a marginally larger revised €6.80 billion in June to €8.09 billion in July. However, this was only a 2-month high and well short of the €17.34 billion peak seen in August last year.

The monthly deterioration reflected a 3.1 percent monthly rise in imports that easily more than offset a 1.0 percent gain in exports. The trend in the former had been down since September 2022 but now seems to be flattening out. Exports remain on a modest rising path. Annual export growth now stands at 6.3 percent while imports are down 5.7 percent on the year.

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.